Setting Up a New Contractor Business in Scotland
Q. What initial steps are involved in setting me up as a Clarity client, if I already have a company and an accountant?
A. If you are already a contractor and have your own limited company, and wish to change from your current accountant to Clarity, all we have to do is write to your current accountant notifying them that you have asked us to take over your accountancy / tax compliance matters with immediate effect. We will then correspond with them to obtain all the information we need to set you up as a client of Clarity.
Q. What initial steps are involved in setting me up as a Clarity client, if I am new to contracting?
A. If you are new to contracting we will need to set up a limited company for you, and thereafter put into place all the necessary registrations for VAT, payroll, corporate tax etc. During this process we will advise you on the best company structure and shareholdings, and the significance and liability of appointed officers etc. We will also provide a financial projection to illustrate your potential net return from your contract.
Q. Do I need a company secretary?
A. No you don’t – it used to be a legal requirement for a Limited Company to have a second individual to act in the statutory capacity of Company Secretary, but this requirement was dropped in the Companies Act 2006.
Q. How long does it take to set-up a limited company?
A. We can set-up a company almost instantly on your behalf, once we have established that your preferred name is acceptable and available. We charge an additional fee for the Company set-up of £125 to cover all the set-up procedures.
Q. How long does it take to organise the VAT and Corporation tax registration?
A. These registrations will normally be in place within one week after company registration.
Q. Why do you charge £125 when I can buy a company online for £19.99?
A. Our fee of £125 includes the £19.99 cost of buying the company, and the balance is for the professional services involved in tax registration, VAT registration, setting up payroll, registering you as an employee etc.
Q. Can I start my contract immediately?
A. Yes – as soon as you call us we will have your company available on the same day and you can provide the necessary information to the Recruitment Agency or end-client.
Q. Does it matter when I form my limited company?
A. Not really, as long as it exists before your contract start date!
Q. What happens if I have been out of work before starting my contract?
A. If you have been claiming unemployment benefit, you need to sign-off and ask for a P45 from the Unemployment Benefit office. If you have not been claiming benefit you need to provide us with the P45 from your most recent employment, even if that was some time ago. If you have neither of these, we can still get you started, so don’t worry!
Q. I have just arrived in the UK from overseas to take up a contract, what difference does that make?
A. Assuming you have the right to work in the UK (e.g. EC citizen; British descendant) then the main thing is that you will not have a National Insurance number or a previous tax history. We can complete the relevant paperwork to create a tax record for you, however you will have to personally obtain a national insurance number as this cannot be done on your behalf. You need to contact your local Inland Revenue office to do this – full guidance will be given if this is relevant to you.
Q. Where will the registered address for my limited company be?
A. This will normally be at your home address or the home of a family member. Any correspondence received there for the company should be immediately forwarded to us or uploaded on your personal page on our website.