Just starting out - The Book-keepers Forum (UK)

Wilma · Member

Just starting out

Accountsguy · Moderator

Hi Wilma,

Welcome to The Book-keepers Forum!

Generally when people become self-employed (especially as book-keepers) they set up as a soletrader. There are a number of reasons for this which include less administration and reporting requirements, lower costs i.e. no annual filing fees or incorporation costs etc. Another advantage is that most people start out part time. Most small businesses make a tax loss in the first year of trading due in part to equipment and set-up costs and the time it takes to build up a client base. As a soletrader you may be able to utilise this tax loss against tax paid in previous employment, and in many cases you may get a tax refund. Operating as a limited company will not allow you to do this and your only option will be to carry the loss forward to offset against future profits. If you haven't started trading yet it may be worth getting some tax advice from an accountant re this.

If you charge £40 and the job is going to take 8 hours per week your actual hourly rate will £5 per hour. This is less than the minimum wage and seems too cheap! Most book-keepers charge anything between £10 and £25 per hour (some even more!). Look around your local area to see what other book-keepers are charging.

All the best.

Guy

-- Edited by Accountsguy at 19:42, 2008-04-02

jenny · Member

Hi Everybody:

I am qualified book-keeper and i am starting to set up my own business as limited company. Am i qualified to provide year end account service to my client as well?

I am now seraching for the cheapest professional indemnity insurance and get the quote around £200 +. Is it normal price or will be bit expensive?

Many thanks for the help and advice.

Jenny

Wilma · Member

Hi Guy
Thank you for your advise much appreciated. I probably did think I was a bit cheap, but some weeks there maybe only about 2 hours work so I tried to put an average on it. His accountant used to charge him only £300 for 9 months processing and £150 for his 3 quarterly vat returns and £50 for adjustments. I thought this considerably cheap considering it was a fully fledged accountant, albeit he didn't do any invoice processing or credit control just the basics enough to comply for vat returns. He used cashflow manager very basic accountancy package based on excel spreadsheets.

Wilma · Member

Hi Jenny

I'm the same as you just starting out, but I am not a fully qualified bookkeeper I don't have any qualifications just my experience gained. I have now registered with the ICB to sit the bookkeeping modules level 1,2 & 3 manual. I have registered with the HMRC for the money laundering regulations, but once I qualify I will apply to the ICB for the practising certificate.

With regards to the year end accounts, me personally would try to negotiate with a local accountant for some rates for your clients. Through my experience especially with my last employment there was certainly areas in the year end accounts that the accountant saved the client a lot of money with regards to corporation tax and personal taxation issues regarding buying property, heavy plant and machinery etc.,. This I feel is where the accountants know there stuff. I personally would not even begin to compete with their knowledge, especially if your client has hugh profits and extremely high turnovers. That is what I feel personally I don't know what other bookkeepers think Jenny.