Accountant Pricing for Holding Co

[markwilson92]

Hi! Just wondering if anyone could give me any advice. I run a small- medium marketing business with roughly £500,000K annual turnover. I'm registered as a LTD company at the moment but am wary of the majority of my income being at risk inside the company

I've been looking into forming a holding company & the benefits of protect my assets in case of ever being sued as well as being able to have other businesses running under the same parent.

My accountant has quoted me £13,000 + VAT to set up the holding company + a yearly fee to look after the books of the newly formed holding co.

The price seems pretty steep & just wondered if that's out of this world insane or fairly usual. Would appreciate any advice!

 

[STDFR33]

£13,000?

What does it entail for that amount of money?

 

[Cloud Accounting]

Was he wearing a mask at the time?

Jokes aside, really does depend on what level of activity will go through holding co. Some which effectively just hold the shares of subsidiary with the odd management charge might be a days work max once a year.

If you're talking about transferring commercial premises or other assets into holding co (to ring-fence etc) then you can soon add several layers of complexity.

You might also want to issue dividends to the holding co (normally tax free) as a means of allowing surplus profits to be moved out of the trading company & similarly ring-fenced. Again, that jiggery pokery adds complexity & starts to take you into realms of specialist advice.

Maybe get him to set out what he would be doing for the £13k & post back on here.

 

[markwilson92]

Haha he may as well have been!

I did ask him to talk me through it & said it was to set the holding co up, for all of the paperwork, communication with HMRC, for share allocation etc...

He also mentioned an ongoing £1000 annually to look after the account on that new co.

What i'm after is simple. Want to keep some money in my business, move some up to the holding co & then some to a new investment co under the parent - my company is very simple & there's only 2 employees so the price feels very high!

 

[STDFR33]

Seems like he’s trying to fleece you.

Seek alternative quotes and see what they are coming out at.

 

[markwilson92]

Seems like he’s trying to fleece you.

Seek alternative quotes and see what they are coming out at.

Thanks very much, it feels that way! I suggested to him me setting it up myself & he was straight on the phone waffling about the things i mentioned in my last message above - seems pretty simple from what i can see?

I've used 'companies made simple' before & they make it seem like it's 10 mins work to set up - pay the £60, allocate the shares & write a simple letter to companies house updating them!

More than happy to pay him an annual £1000 to keep the finances of that company!

 

[Cloud Accounting]

Its likely & probably justifiably he’s built in extra for if you did start shunting stuff between the two. The initial set up is an afternoons work, but as you’ve alluded to you’ll soon want to start moving stuff around & each of those have tax & other implications.

The £1k seems reasonable as he'll still have all the filings to do no matter how simple the setup. But by any measure the £13k seems high. Pushing some alternative quotes in front of him might force him to sharpen his pencil.

 

[Cloud Accounting]

Thanks very much, it feels that way! I suggested to him me setting it up myself & he was straight on the phone waffling about the things i mentioned in my last message above - seems pretty simple from what i can see?

I've used 'companies made simple' before & they make it seem like it's 10 mins work to set up - pay the £60, allocate the shares & write a simple letter to companies house updating them!

More than happy to pay him an annual £1000 to keep the finances of that company!

Feels to me he's front loaded charges so id be inclined to say you're happy to pay a larger ongoing fee - if volume/complexity of transactions warrants it - but only want to pay up front for the initial set-up.

Again though, its not just a case of registering with companies house, every transaction between group co's has implications that he'll need to give careful consideration to.

 

[UK Contractor Accountant]

've been looking into forming a holding company & the benefits of protect my assets in case of ever being sued as well as being able to have other businesses running under the same parent.

Suggest you do a review of your business insurance policies/cover in the first instance.

 

[UK Contractor Accountant]

What i'm after is simple. Want to keep some money in my business, move some up to the holding co & then some to a new investment co under the parent - my company is very simple & there's only 2 employees so the price feels very high!

have just done this for one of our clients who wanted to shunt some profits into holding co in order to invest in property without affecting the main trading co. Cost less than £15K to set up SPV.

 

[Rawlinson Pryde]

Setting up a Limited Company to protect your assets is a good idea for that extra saftey. We would be happy to provide you with an alternative quote. Without seeing anything the quote appears to be really quite expensive.

We have helped several of our clients to set up a holding company before, so have the necessary experience and if your business affairs are as simple as hinted we would be able to prepare the necessary HMRC clearance for a fraction of the price.

There are also other things you should consider like setting up a VAT group.

Feel free to get in touch with us (Web address in signature below) and hopefully we will be able to provide you with a more satisfactory price and a quality level of service. We have a number of qualified accounts and also a couple of Chartered Tax Advisers who will be able to assist you.

 

[ExpertAccountant]

I can understand why you feel that is a lot of money for what appears to simply be a setting up of a holding company. But in reality it is not as simple as that. You will need to obtain HMRC clearance beforehand and then draw up the necessary legal paperwork to avoid future issues with HMRC. Having said that, £13k plus VAT is still a lot of money.

If you wish to discuss this further and want an alternative quote feel free to contact us.