The Freelance Thread (Contractor, IR35)

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  • The rules around IR35 are so vague and open to interpretation I don’t think there is such thing as a definitive answer. HMRC has recently been defeated in the courts and told it is interpreting its own rules incorrectly.

    In effect it’s whether you are in reality an employee (Employment rights, wage the same, working practice the same, etc) or a dispensable resource used on an ad hoc basis by your client/s. If you don’t have the benefits of being an employee why would you go inside IR35.

  • If you don’t have the benefits of being an employee why would you go inside IR35.

    Because you recognise you are on the wrong end of an unequal power relationship.

  • Anyone ever filed accounts as a micro-entity because FUCK ME do I feel thick trying to attempt it.

  • I've always winged it. Seems to work ok.

  • for called up share capital not paid I just put a quid because I (the only shareholder) have one share at a quid, and I didn't pay my company for it - ok?

    then i've just left of all the stuff about deferred and accrued income for simplicity, and i've put total fixed assets at 0 (no property or machinery etc.) total current assets = my company's bank balance on the final day of the accounting period.

    liabilities are 0

    but the autocalculate box for Total net assets (liabilities) is just showing as 1, which i don't get.

    and i assume Capital and reserves should be the same as my bank balance on the final day of the accounting period?

  • Anyone got suggestions for a liquidator? Should be pretty straightforward, no debts, yada yada.

    Or could I just leave the company around and do something else with its £s? Buy a villa in Spain, cocaine and midgets, new titanium gooch, etc.

  • I used MVL Online. Very straightforward.
    Similar state. No debts, just me as a director, nothing fancy anywhere.

    Timelines for me were
    instructed them in Feb
    first monies to me a month later (about 80% of the total)
    winding up etc, notifying HMRC, waiting for anyone to raise claims/disputes etc took a further 5 months, and I got the last of the monies in september

    5/7 would recommend etc

  • the more i research this, the less sure i become. i'm going to need an accountant, I think

  • Do you know what they charged? Was it a fixed fee?

  • Exactly what they said it should be
    https://www.mvlonline.co.uk/total-cost/

    995 +vat fees
    227.85 +vat statutory advertising
    And £168 statutory bond

    Nothing hidden or extras that appeared at the end

  • Assets and liabilities need to balance. You have £1 share capital, which is a liability (rather assets = liabilities + equity).

    Usually, this would be paid up - i.e an asset of £1 in cash.

    As it's not paid, there is asset of the £1 debt.

    (A quick google suggests that you can have an exolicit balance sheet item for called up share capital not paid - the £1 in this case)

    NB IANAA

  • .

  • Think I’ll go freelance completely by end of this year... currently looking at opening a business account, what do you guys use, if you do?

    Most high street banks seem to give 18 months free monthly fees then it’s about £5 a month thereafter.

    Metro bank gives free business account if you maintain your balance at £5000+ which I could do... that seems the best deal...

    Or do people just do away with a personal account?

  • Go with metro bank if you want to save money, i have used crunch accounting for last 4+ years, i can send you a referral code.

    Edit: i would look at the likes of monzo etc (app only banks) if they do business account.

  • How do you mean save money? The £5 monthly fee? I guess all banks are pretty much the same for fairly straightforward sole trader 1 person operations...

    I’ll let you know when I am ready, not quite yet.

    Monzo doesn’t currently do business account, they have a sign up to their waiting list thing... 🤷🏻♀️

  • My dad said use Santander so I did and they've been good to deal with.

  • Edit: i would look at the likes of monzo etc (app only banks) if they do business account.

    Soon
    https://monzo.com/business/

    Ah yeah, what ExTra said...

  • Got more questions that the Internet will give me answers but I love you guys, so here goes...

    So my freelance work will mainly consists of delivering software training courses etc. I am about to drop £2k for a super duper PC desktop so I can have a much faster machine to design and write the courses, test out new stuff / plugins etc etc before teaching them. If I have time, will probably start taking freelance design work too... Teaching won't happen at home though... I would want to put the PC down as business expense, would it qualify?

    In what order should I do this or does it matter? I need to register as a sole trader, open a business account, buy that computer.

    Also, how do I prove that the computer is 100% business use in order to qualify for business expense? It's one of those things that it's practically impossible to use for work only... (I do have a very good laptop that does everything I need but just not fast enough for the 3D / game design software I will be teaching)

    I am about to buy a new bike too... business or no business, can I claim half of cost as business expense because I probably will ride it to my training courses?

  • Thoughts on N26? Their money protection is with Germany so nobody knows if Brexit will affect that... but it does seem to be the only free business account with no min balance...

    https://n26.com/en-eu/business-account

  • free business account with no min balance...

    Caterallen is UK regulated, and fscs protected

  • Minimum balance is £5k, so same as Metro.

  • Minimum balance is £5k, so same as Metro.

    https://www.caterallen.co.uk/news/minimu­m-account-balance-fee-removed

    Had no complaints when I used them. The online banking is something from the 90s but it was functional. And if you called then you were straight through to someone.

  • The online banking is something from the 90s

    Heh - it's so dated, isnt it?

  • Cool! Isn’t it better to change the actual page seeing the news is over a year old...

    Oh wait... They are old fashioned... 🤭

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The Freelance Thread (Contractor, IR35)

Posted by Avatar for amey @amey

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