Does a one man band Ltd company really need an accountant?

[Bartholomew Hearn]

Just 1 foot high is quite something, hehe. This is quite an interesting topic, peculiar where you will end up at.

 

[Mr D]

Well I did hear that tax doesn't have to be taxing. Sole trader sounds fine I guess, to begin with, and then save up a couple of hundred for an accountant. The only thing is that for what I'm doing, I read somewhere that I have to be a Ltd company, or at least it's better to be. I'll have to look into that.

Just to clarify, I want to buy goods from suppliers in China on the Alibaba website, and sell them on Amazon (FBA) in the US. I don't know if that changes anything.

You get to register with and supply the sales tax to a number of US states. Last I looked FBA in the US had 19 nexuses - that may have increased since.
There are other options for US selling than FBA on amazon. Using a fulfilment service based in one state is a touch easier on the admin.

 

[Mr D]

It cost me £170 to have an accountant set up the business. I do all the bookkeeping. I paid nothing else until after the first year end when the accountant took the "books" and did the accounts. Just make sure you put enough money aside to cover this and taxes due.

Think mine was a tenner to set up.

 

[Johnny1975]

You get to register with and supply the sales tax to a number of US states. Last I looked FBA in the US had 19 nexuses - that may have increased since.
There are other options for US selling than FBA on amazon. Using a fulfilment service based in one state is a touch easier on the admin.

I heard about a site called taxjar, and they do the difficult part of that (sales tax). Is it possible to do without a service like that? I mean, how would I do it on my own?

 

[Pish_Pash]

It cost me £170 to have an accountant set up the business.

It cost me a tenner & took me 15 minutes (it was a piece of proverbial)...seriously, there are whole industries built around those who have an "Erhm, perhaps I ought to get someone else to do it for me" mindset....now, I wanna be the guy charging 170 quid to set up a new business for others!

 

[Newchodge]

Oh right, now I'm tempted to change my mind again and have a Ltd company. So with just £200 or less I can have this side of things taken care of, and all I do is the day to day bookkeeping and basic accounts? Is it really as simple as that?

NO It absolutely is not as simple as that. The poster who paid £170 to get his business set up could have done it themselves for less than £20. That part is really simple.

That is nothing to do with filing year end accounts.

If you keep perfect records in a format that the accountant can use then you may get someone to file your year end accounts etc for £200, but you will have already made business decisions that you may have made wrongly, costing you money.

 

[STDFR33]

It cost me a tenner & took me 15 minutes (it was a piece of proverbial)...seriously, there are whole industries built around those who have an "Erhm, perhaps I ought to get someone else to do it for me" mindset....now, I wanna be the guy charging 170 quid to set up a new business for others!

Setting up the company is a piece of piss. There I said it.

But if someone wants advice, such as:-
(1) should they be adding a spouse as shareholder
(2) should there be different classes of shares (3) is beingVAT registered from the start beneficial
(4) bookkeeping training
(5) explaining properly and in detail the obligations of being a shareholder and / or company director
(6) would a salary be beneficial
Etc etc, then that's more than clicking a few buttons at Companies House or a formantion agents website, and it's going to cost you more than a no frills service.

At the end of day, you get what you pay for.

No frills suits some people, but not others.

 

[Johnny1975]

NO It absolutely is not as simple as that. The poster who paid £170 to get his business set up could have done it themselves for less than £20. That part is really simple.

That is nothing to do with filing year end accounts.

If you keep perfect records in a format that the accountant can use then you may get someone to file your year end accounts etc for £200, but you will have already made business decisions that you may have made wrongly, costing you money.

I know. That's what I meant. The other poster said that the £170 was for an accountant (not setting up the business). What I'm saying is that it seems to be a simple case of taking care of the day to day bookkeeping and accounts (doing them correctly and carefully, of course) and then handing it over to the accountant towards the end of the year for them to do the rest.

 

[Newchodge]

It cost me £170 to have an accountant set up the business. I do all the bookkeeping. I paid nothing else until after the first year end when the accountant took the "books" and did the accounts. Just make sure you put enough money aside to cover this and taxes due.

I know. That's what I meant. The other poster said that the £170 was for an accountant (not setting up the business). What I'm saying is that it seems to be a simple case of taking care of the day to day bookkeeping and accounts (doing them correctly and carefully, of course) and then handing it over to the accountant towards the end of the year for them to do the rest.

If you intend to do your own accounts after reading about it you need to read more carefully. DontAsk had an accountant set up their business for £170. That may or may not have been a good deal, depending on whether the accountant did more than fulfill Companies House registration requirements. DontAsk then paid no more accountant's fees until after the first year end, when they had to pay for the accountant to take the books and do the year end.

 

[Johnny1975]

If you intend to do your own accounts after reading about it you need to read more carefully. DontAsk had an accountant set up their business for £170. That may or may not have been a good deal, depending on whether the accountant did more than fulfill Companies House registration requirements. DontAsk then paid no more accountant's fees until after the first year end, when they had to pay for the accountant to take the books and do the year end.

Well I'm certainly going to learn as much as I can. But actually now I'm starting to think that I should start as a sole trader to keep everything a lot simpler. I understand that I could quite easily handle the accounting myself since HMRC / Companies House wouldn't need much from me.

If only I knew exactly how much accounting I need to know as a sole trader. I might already know enough, but I don't know if I do.

 

[Newchodge]

As a sole trader you need to know to keep accurate records of all expenditure and income, backed up with invoices and receipts, and to understand what expenses are allowable for tax purposes. You also need to get your head round the fact that you and the business are a single entity, so the business doesn't pay tax - you pay tax. You cannot pay yourself a wage because all the money earned through the business is your money.

 

[Ian J]

Well I'm certainly going to learn as much as I can. But actually now I'm starting to think that I should start as a sole trader to keep everything a lot simpler. I understand that I could quite easily handle the accounting myself since HMRC / Companies House wouldn't need much from me.

You won't have any involvement with Companies House as a sole trader. Have a look at Accounting for the Self Employed and then Google "sole trader accounts" or similar for other reading matter

 

[DontAsk]

Setting up the company is a piece of piss. There I said it.

But if someone wants advice, such as:-
(1) should they be adding a spouse as shareholder
(2) should there be different classes of shares (3) is beingVAT registered from the start beneficial
(4) bookkeeping training
(5) explaining properly and in detail the obligations of being a shareholder and / or company director
(6) would a salary be beneficial
Etc etc, then that's more than clicking a few buttons at Companies House or a formantion agents website, and it's going to cost you more than a no frills service.

At the end of day, you get what you pay for.

No frills suits some people, but not others.

Exactly! It was worth every penny, regardless of what anyone says.

 

[DontAsk]

The other poster said that the £170 was for an accountant (not setting up the business). W

Er, no, read it again. It was for an accountant TO SET UP THE BUSINESS.

 

[Johnny1975]

Er, no, read it again. It was for an accountant TO SET UP THE BUSINESS.

Ok don't bite my head off.