Setting up as an IT contracter...advice?

errigal

Hi

Having worked as a regular PAYE employee in my career to date, I'm now
taking the jump into the world of IT contracting.

I've done some homework and decided to go down the Ltd company route. I was wondering if anyone has any recommendation in terms of a company/accountant to use to do all the spadework in terms of
a) setting up the company
b) providing good advice
c) doing tax returns, etc.

I've visited a few websites, but a personal recommendation is always helpful.
Obviously reputable firm, reasonable cost, etc. What sort of cost should I be looking at for this service (ballpark range?)

TIA

Merrion

I pay €115 per month to Giant financial services for all the accountancy needs.
Got a Ltd company off the shelf from them too.
Why not give them a call and go in for a chat - they can give you the breakdown of the various options.

kluivert

Limited Company?

I have the following question for you.

Why choose a limited company. Why not go with a Sole trader status. Have you got more to benefit financially as a Ltd Co. or is it the limited liability status you seek.

I personally am of the opinion that when you are established and your business is growing, then seek the option of limited liability.

As far as i know there is another chap who is a member here who will provide accounts assistance. He is a part qualified accountant like myself, so if you need help on anything give us a buzz and see what we can come up with.

As for being self employed, well thats definitely the route to take in my opinion.

Good Luck.

DublinWriter

kluivert wrote:

Why choose a limited company. Why not go with a Sole trader status.

Because most IT agencies will only deal with you if you're trading as a Ltd. company.

Merrion

Because most IT agencies will only deal with you if you're trading as a Ltd. company.

The same is the case with most client companies.

If a company is employing you and you are a sole trader there is a huge risk that they might be deemed to be your direct employer and as such liable for all the legal stuff associated with that (sick pay, PAYE etc.)

kluivert

With the last point.....

This shouldn't be an issue if you have more than one client.

If on the other hand you only have one client on a long term basis then, hiding behind a company status will not be sufficent enough to satisfy the revenue that your company doesn't work for the client and thus therefore is an employee of the client, meaning you.

‘One of the basic questions to be answered is whether a person who has been engaged to perform services is performing them as a person in business on his or her own account. If the answer to the question is ‘yes’ then the person will be self-employed and, if the answer is ‘no’, then the person will be an employee.

In answering this question employed or self empolyed see list the following helpful factors:

control;
personal service;
equipment;
financial risk;
basis of payment;
mutuality of obligation;
holiday pay, sick pay and pension rights;
part and parcel of the organisation;
right of dismissal;
opportunity to profit from sound management;
personal factors;
length of engagement;
intention of the parties.

DublinWriter

kluivert wrote:

This shouldn't be an issue if you have more than one client.

Nope. Agencies won't touch you with a ten-foot bargepole if you're not trading as a Ltd. company. End of story. A lot of clients won't deal with you either if you're looking to work directly for them.

That's the sad reality of the situtation.

kluivert

I suppose its a sector am not too fimiliar with.

It a shame really. The administration cost of a company and the responsibilities in which directors have now can place a weight on ones shoulders that sole traders don't have. Enough said.

Lets get some good straight advice on how this gentleman can get his company up and running.

One company formation firm we use is KearneyCurran. The fee is €242 or there abouts. Ring to make sure though. Or see www.cro.ie for advice on company formations and see their leaflets and guides section.

ArthurDent

DublinWriter wrote:

Nope. Agencies won't touch you with a ten-foot bargepole if you're not trading as a Ltd. company. End of story. A lot of clients won't deal with you either if you're looking to work directly for them.

That's the sad reality of the situtation.

Maybe this is the case in IT sector. I've been working as consultant in Pharmaceutical/Biopharmaceutical sector for 3 years as a sole trader and my clients are Govt agencies/Thrid Level Institutes and VC companies - allI have ever been asked for is a tax clearence cert - never been refused any contract because I'm a sole trader. JMHO

Jivin Turkey

There are a number of tax reliefs available to you if you trade as a limited company rather than as a sole trader.

You could also incur capital gains tax liabilities if you decide to incorporate your business having previously operated as a sole trader.

fintan

Merrion wrote:

I pay €115 per month to Giant financial services for all the accountancy needs.
Got a Ltd company off the shelf from them too.
Why not give them a call and go in for a chat - they can give you the breakdown of the various options.

Hi Merrion

does the 115 a month include tax returns, year end accounts, monthly reconciliation of all the books etc?

can you just dump off a bag of receipts / invoices / bank statements once a month or do you record everything yourself and then give it to them?

Just curious, as it doesn't work out much more expensive than what I was quoted to just do the year end accounts / corporatyion tax return ( i do all vat returns and monthly reconciliations)

Cheers

Fintan

Merrion

You record eveything is a spreadsheet and send it (plus all the receipts etc.) off to them each month.

I'd recommend you do your own book keeping anyway as you are responsible for the figures so you might as well be able to "show your working out" as they used to say in maths exams.

Figment

http://www.garrettdimon.com/archives/about-going-solo
Almost everything you need.

Graham

I'm an IT contractor and use http://www.prima.ie.

They will setup a limited company and do all the accounts, annual returns etc for you.

They also have a facility whereby you can work through one of their umbrella companies. This is a great option if you are unsure you are going to be contracting long-term and it still allows you to offset expenses etc.

I've referred about 6 people to them so far and as yet never heard a bad word back.

RicardoSmith

ArthurDent wrote:

Maybe this is the case in IT sector. I've been working as consultant in Pharmaceutical/Biopharmaceutical sector for 3 years as a sole trader and my clients are Govt agencies/Thrid Level Institutes and VC companies - allI have ever been asked for is a tax clearence cert - never been refused any contract because I'm a sole trader. JMHO

Its the norm for IT work. In my experience its the Agencies that insist on this. Most companies don't seem to bothered.

homeOwner

A friend of mine had one of the large management/financial companies (I'd name and shame them here but I dont think its allowed) do his accounts and basically found out after a few years that they had not complied with some very serious regulations.

My advice is to check up on your accountants to make sure they are filing everything properly and you are up to date with payments with revenue. He has since moved to another management company but it took about 6 months to sort out the mess they made.

shurl

Graham wrote:

I'm an IT contractor and use http://www.prima.ie.

They will setup a limited company and do all the accounts, annual returns etc for you.

They also have a facility whereby you can work through one of their umbrella companies. This is a great option if you are unsure you are going to be contracting long-term and it still allows you to offset expenses etc.

I've referred about 6 people to them so far and as yet never heard a bad word back.

I second that, with them nearly 3 years now.
I was working through one of their unbrella companies, now I've set up a Limited Co through them. (Due to client request)


S.

ianmc38

Hi Graham, do you know what % they take with the umbrella company? I'm currently paying 5% of gross and looking for alternatives. Also whats the premium rate service? If you could drop me a pm that would be great.

Cheers.

Ian

Graham

You get charged a % :eek: so if you earn more you end up paying more (even though the level of work for the umbrella company stays the same)!

I pay a flat monthly fee (afair €110 + VAT) and if I remember correctly it's the same per month if you have your own limited company.

Best thing to do is give them a call as I'm just going from memory here.