Contractors and Freelancers: Choosing the right name for your Limited Company

Forming your own limited company is the start of something wonderful, you are stepping out and building your own business. Creating an identity for that business is important for its success.

Just as your own name is integral to your own identity, the name you chose for your limited company is integral to letting people know what it is and what service(s) it offers.

This week’s article looks at what you need to consider when choosing a name for your limited company.

Motorway or A road?

There are 2 routes you can take when registering your limited company with Companies House. You can decide to go the quicker route and purchase an ‘Off the Shelf, Ready Made’ limited company that is available for immediate use. Or, as most contractors and freelancers choose to do, you can set up your own limited company with a name chosen by yourself. This is option involves filling in more paperwork, but in the long run, it will be a company that represents who you are.

Not as simple as A,B,C

Picking your limited company name is not as easy as it sounds. There are certain rules that you need to follow. These are set out by Companies House and include:

• the name has to be unique, it can not be the same or similar as another registered company
• the name can not contain a ‘sensitive’ word
• the name can not suggest a connection to the Government or a Local Authority
• the name must not be offensive

More information is available in the document ‘Incorporation and names’ from Companies House.
We recommend reading through this document before you start the process of choosing your limited company name, so you are familiar with the legal requirements.

Crazy, Concise or Common Sense?

As we mentioned at the beginning of the article, a name is integral to creating a strong identity i.e. creating a strong brand. At the centre of any brand, is the brand name. It’s a calling card to the world!

There are different options you can take when choosing how to name your limited company, these include:

• keeping it simple and incorporate your own name into the limited company name e.g. Frank Jones Limited
• basing it on the services that the company offers e.g. F Jones IT Consultant Limited
• or, you could choose to use something that is unrelated to what you and what the service the company offers. A well-known example here is Apple. What has an apple got to do with technology?

Whichever, option you decide to take, it is important to also consider:

• is the name professional
• is the name easy to remember (if it’s too wordy, people will have problems recalling it)
• is the name easy to spell (complex spelling will lead it to been misspelt)
• will the name still be relevant in years to come (your service offering may change over time, will the company name to be able to reflect this)
• is the name marketable

Marketing should not be an after-thought for any business. Asking yourself “Will it be simple to market my company?” should be one of the questions you ask yourself during the naming process.

Before, registering your company name with Companies House, check out how web-friendly the name is. Look at sites such as 123.Reg or GoDaddy to see if it is available as a domain name. This is important if you choose to launch a website to support your Limited Company.

If you are thinking of launching your own Limited Company and require assistance with it, contact us today on 020 8952 2234 and we would be delighted to talk you through the process.

Are you ready?

Hurray! HMRC have finally revealed more details about the controversial plan called ‘Making Tax Digital’. In fairness to HMRC, they have been reluctant to release details until the first round of consultations were undertaken.

However, this silence could have worked against them. It seems that Making Tax Digital has bypassed a large majority of small businesses. In a recent survey carried out by FreeAgent, 43% of small businesses and freelancers reported that they haven’t heard of the plan for Making Tax Digital.

HMRC should find this a worrying statistic.

If you find yourself amongst this 43%, don’t panic. Our article explains what Making Tax Digital is and the key points you need to know as a freelancer or contractor. So don’t be afraid, be prepared.

What is Making Tax Digital?

Making Tax Digital (MTD) is an ambitious Government plan (that was first mentioned in the Spring 2015 budget) that will change the annual tax return to a quarterly online system.

The tax system is often described as archaic and slow. HMRC argue that Making Tax Digital will:

• Bring business tax into the digital age
• Transform the tax system
• Simply tax for small businesses

Details were slow coming forward, but information put out by HMRC shows that:

• Making Tax Digital currently only applies to sole traders and partnerships
• Businesses with a total annual turnover less than £10,000 will be exempt*
• Business will need to send summary data each quarter to HMRC , and not file quarterly tax returns, as first speculated
• Consultations will be held later this year (estimated to be October) for how Making Tax Digital will affect Limited Companies and their directors

*The important point to note here is ‘total annual turnover’, if you run two businesses, each with a turnover of £9,000, you will have to comply with Making Tax Digital, as your annual turnover is £18,000.00.

What does Making Tax Digital mean to you as a Contractor or Freelancer?

As the name implies, tax is turning digital. So in order to comply with Making Tax Digital, businesses will need to send their quarterly summaries into HMRC using an online accounting software. This software will not be provided by HMRC, but reporting online will be mandatory, except for a select few who will be exempt.

Exemptions will be considered for disability, age, remoteness of the location and any other reasons (not currently specified by HMRC).

So, we are afraid that saying “I am a technophobe” or “My broadband is too slow” will not cut it (anyone with access to broadband with speeds 2Mbps or faster will have to submit their updates online).

However, you don’t have to stick to quarterly reporting, if you want to do it more frequently, you can, monthly for example.

How you can prepare yourself for Making Tax Digital

Details are still being finalised, and consultations are still taking place. We urge you to voice your thoughts and concerns (if you have any) to HMRC. They are running a series of events and webinars where you can find out more information and ask questions. To find out more information on these consultations, click here.

Making Tax Digital will be rolled out from 2018. So, it is time to start thinking about getting ready for it. ICAEW reported that only 25% of small businesses currently use online accountancy software. If you will be required to comply with MTD, is advisable to start looking at which online software is the best for you. Additionally, if your accountant does your return for you, ask them if they can support you in Making Tax Digital.

If you are looking for expert advice on how you can move your finances online, give us a call on 020 8952 2234 or email info@cogentaccountants.co.uk

The demand for finance contractors has risen dramatically over the last few years as, and research shows that this trend is set to continue. When they can not find the skills in-house, banks and financial institutions turn to freelance contractors for their specialist skills.

Finance contractors typically work some of the longest hours in the industry. At Cogent, we understand how busy your life is. To help make it a little easier and simpler, we give you our top apps and gadgets that every finance contractor should be using.

App for managing your time

For keeping track of your time, we recommend WAVE. Launched in 2014, it is quickly becoming the most popular calendar app on the market. There are far too many positives to include in this post, so we have listed just a few for you:

•  simple, clean design
• easy to install and to use
• integrates with Google Maps (if you add an event, it will attach a map giving directions to the event)
• syncs with Google Tasks (it colour codes tasks which enables you to easy differentiate between them)
•  has 6 different list styles

It integrates with Android and IOS devices and is currently free to download.

Visit http://www.wavecalendarapp.com/ for more information.

Gadget for keeping fit

Keep-fit gadgets have been around for a while now, but in the last year they have become smaller and better designed. Our favourite on the market is FitBit. They have different products on the market, depending on the style, size and budget you have.

Their latest product the FitBit is the FitBit Alta. It costs around £100.00 and enables you to track how many steps you have done, the distance you have covered, counts how many calories you have burned off. It syncs with Andriod and IOS devices, unfortunately, it is not compatible with Windows phones at the moment.

You can set yourself daily challenges, for example; challenge yourself to take 10,000 steps a day. You can even set up group challenges, so your whole team can keep fit.

Visit https://www.fitbit.com/uk for further details.

App for navigating your commute

Is your daily commute into the city dogged by delays? Do you frequently find you are running late because of problems with transport? If you answered “Yes” to both questions, then Citymapper, could be the app for you.

Available on Andriod and IOS devices, it maps out your journey, giving you the easiest and quickest route. But it does more than that, it gives you live updates on the tube, tells when your next bus is due and how much the journey costs, it also gives details on cycle routes (if you are brave enough to use this option) and tells you long it would take you to walk.

The best news is, you get all this for free.

Visit https://citymapper.com and try it out for yourself.

App for organising your travel documents

As a finance contractor,  you may have to travel a lot for work. If so, keeping all your travel documents organised in one place is extremely important. You don’t want to get to check in and find you haven’t got a copy of your boarding pass.

If you have to travel frequently for work, then you need Tripit.

Tripit, is an app that organises all your travel documents in one place. The free version, allows you to access your documents on your tablet or smartphone, syncs with your calendar so you know when you are travelling and where you are staying and you can share your these documents with others, for instance, your boss. So he/she knows your where you are (we are not sure if this is a good or bad thing though!).

The paid for version, gives you more options, such as getting real-time flight alerts, so you know if your flight is on-time or not, and it also automatically gives you alternate flights if you need to rebook your seat.

If you are a frequent traveler, check out https://www.tripit.com/ to see what other features if offers.

App for keeping track of your business

If you are looking for a service that can handle all your business finances, we recommend FreeAgent.* It is extremely popular amongst freelance contractors (it was originally designed and developed by three IT contractors) as it was designed with contractors in mind.

In short, it enables you to control your finances on the move. You can create and send invoices, record your expenses and snap receipts with your phone on the go and upload them to FreeAgent wherever you are. Anything you do in the app is immediately updated in your FreeAgent account.

The most important aspect of FreeAgent is that you can share this access with your accountant as well.

Visit http://www.freeagent.com/ for more information.

*In order to use the FreeAgent app you do have to have a FreeAgent Account.

Here, at Cogent Accountants, our philosophy is to make your life as a finance contractor, simpler and easier.  Using the latest technology and expert knowledge ‘we do the work, while you do the play’.  Speak to us today to see how we can help you manage your finances.

Every contractor should love their accountant. Why? I hear you asking. Well, firstly they love doing the thing you hate: your tax return, secondly, they can save you money, and thirdly, they can help your business grow and become successful.

If you have fallen out of love with your accountant and are looking for a new one, or, you are looking to engage the services of an accountant for the first time, then ask yourself the following questions:

What do I need an accountant for?

Think carefully about what you want the accountant to do for you. If you are new to contracting and are looking to operate via a Limited Company, choose a firm of accountants who can set this up for you. There is quite often a charge for this, but some firms will do this free of charge as a way of enticing you to sign up to their services.
You might already be operating via a Limited Company but are finding that you need guidance in other areas, for instance, you might be wondering if you need to be VAT registered, or you are unsure if you are working in or outside of IR35.

Decide what you want the accountant to do for you, and clearly communicate this to them when you are enquiring about their services. If they can not help you with this, look for somebody who can.

What type of relationship am I comfortable with?

Do you want to be able to go and see your accountant and discuss things face to face? Or, are you comfortable dealing with them over the phone and by email? If you prefer face to face meetings, it is pointless choosing a firm who is situated miles away from you.

If you are comfortable dealing with them by phone and email, check out how easy they are to get hold of. Call their offices and see how quickly they answer the phone or drop them an email and see how long they take to respond.

It is worth asking who you will be dealing with and if you will get to speak to the same person each time. You ideally should have one person who oversees your account. Some larger firms of accountants operate via a call centre system and your call or email will be allocated to the next available consultant.

How easy are they to use?

There has been a big shift in the last few years with accountants moving to online systems. These web or cloud based systems are popular because of their ease of use and accessibility. Ask if you will you be shown how to use it and what aftercare support is provided. You don’t want to sign up to it and then discover when something goes wrong, that you are left on your own to sort it out.

How much do they charge? 

Fees vary from firm to firm. Do a comparison of your selected firms (seek recommendations from others) and list out their fees and what they include and don’t include. This will help narrow down the search.

Do they know what they are talking about?

We have saved the most important to last, ‘How experienced is the accountant in the contractor market?’ Look on their website and find out details about the partners and account managers. Note what professional bodies they belong to.

Ask for examples of the type of enquiries they are experienced in dealing with (this type of information is often included in the firms welcome pack). Most, accountants now have a page on their website showcasing client testimonials. Have a read through and see what people have to say.

The best way to find an accountant is through personal recommendations. Speak to other contractors, explain what you need the accountant to do for you and ask who they would recommend you use.

At Cogent, we pride ourselves on the personal relationships we build with our clients. That is why many of them have been with us for a long time. They know, they can pick up the phone and speak to somebody who knows them personally and who understands their business. If you are looking for an accountant, give us a call today on 020 8952 2234. 

The Olympics is a spectacular event. It is awe inspiring to watch the athletes who have trained for years to compete in the games to win a medal. If we said to you that athletes and contractors have a number of things in common, would you believe us? Probably not! But, it is surprising how much in common contractors and athletes have with each other: each is a specialist in their field, competition for the top spot is rife, and if successful,  the rewards are great.

So, in celebration of the Rio Olympics 2016 , we look at what contractors can learn from athletes on how to ‘Crush the Competition’:

Be adaptable

It will be surprising to know that quite a few of the world’s top sports personalities actually started out in a different sport. For instance, Ian Botham (top cricketer) started out playing football for Scunthorpe United, and possibly most surprisingly, Usain Bolt(fastest man on the Earth)  dreamt of playing football for Manchester United!

We are not suggesting that you quit your job to become a professional sports person! What we are saying, is that, it can be easy to stay with what we know. But, if this is not working out for you , don’t be afraid to try something else.

Aim to beat your personal best  

When an athlete achieves a ‘personal best’, it is not the end of the road for them. The drive and determination they have, steers them on to do even better next time. As a contractor, operating in a highly competitive arena it would be irresponsible not to adopt the same philosophy.

As Albert Einstein said, “Once you stop learning, you start dying”. Regularly take time out to top up your knowledge and skills by reading trade magazines, attending training courses organised by industry bodies or brushing up on your skills with online training courses.

This is particularly pertinent if you contract in the digital or IT market where technology is developing at such an immense rate.

Don’t operate in isolation

Behind every great athlete is a great team of professionals, including psychologists’, medics and coaches. As a contractor, you won’t need this level of support (unless you have a dangerous job!), but it is important that you have a support network around you, and an accountant needs to be included in this.

An accountant who is experienced in the contractor market will be able to advise you on the best way to operate and how to minimise your tax responsibilities. Tax is a very complicated area and getting it wrong could have a devastating effect on your business, so getting professional advice on is very important.

Invest in your brand

Every top athlete knows the importance of building their personal brand to help attract lucrative endorsement deals. Whilst you might not be looking to find sponsors, you are trying to attract new contracts. Having a distinctive brand will help differentiate yourself from your competition and help sell your services to clients. At the basic level, this should include having a profile on a business networking site such as LinkedIn. If you want to move it to the next level, creating a simple but well-designed website will help establish your brand.

Know your competition

You may see your competition as the enemy, but they can also be a role model, somebody who you look up to and learn from. In your network, is there somebody who you admire? If the answer is yes, spend some time studying how they work and what areas they specialise in. Then use this knowledge to make your service offering even better.

As a contractor, it is impossible to study all your competitors, as there are thousands of contractors out there offering a similar service to you. So, limit your research to those you know well or have worked with before.

In order to win the race, you have to be in it in the first place

What you don’t want to find,  is that you have put in a great effort to go for a contract, only to price yourself out of it. A way around this is to talk to recruitment consultants who specialise in your field to find out what the average rate is for a particular skill set, and then use this to establish your own minimum charge rate.

For further contractor tips, please check out our other articles. Alternatively, if you would like to speak to a member of the Cogent team, please call us on 020 8952 2234. 

Productivity tips for Contractors and Freelancers

We are in the midst of the holiday season and the temperature has increased by a degree or two. Hurray! It might be summer and you are focused on your summer holidays and lazy days in the sun, but you still have work to do or clients to please.

To help you get through this ‘manana mood’ and get the most out of your working day, we bring you our essential productivity tips for contractors and freelancers.

Fill the tank

A car can’t run without oil and petrol (or diesel). The same philosophy applies to you. Your body and brain will not be able to reach full throttle unless it has enough fuel. So, start the day off with a fuel enthused breakfast, have regular snacks throughout the day and drink plenty of fluids (water and juice).

Set yourself a challenge

My favourite tip is to set yourself personal challenges throughout the day. Got a report to write? Then challenge yourself to get it finished by a certain time. If you succeed, then reward yourself with something you like. In my case, chocolate! If you fail the challenge, then you face a forfeit.

Take charge

We all hate attending meetings when we are bogged down with work, but sometimes they are necessary. If you find yourself in this situation, be the boss and take charge of organising the meeting. This way you can pick a time that suits you and determine the schedule.

If you have clients to catch up with, don’t wait for them to call you. Be the one to call them. If they don’t answer, leave a message stating that you will call them back at a designated time. This way you know your time will be free to complete your urgent tasks.

Stick to a schedule

It might have been a long time since you were at school (it was for some of us here!) but we all remember what the school day structure was like ‘lesson, break, lesson, break…’ This routine may seem regimented but it works. It is important to take regular scheduled breaks throughout the day. This will stop you from getting distracted and wasting valuable minutes.

Banish futile technology

Smartphones are fantastic but they can also be addictive. It is very tempting to quickly catch up with what is happening on Facebook or Twitter, or play a quick game of Pokemon Go! Don’t get into the habit of doing this during your working hours. Save it for lunchtime or the journey home. Instead, invest your time in using technology that will make your work life easier, such as Trello, Evernote, GotoMeeting etc.

Strip it all back

We have all come across colleagues or clients whose emails resemble the book War and Peace. They think they are being helpful by giving you all the details and you are thinking ‘just get to the point’. The trick is to read the email thoroughly and then highlight any important information. If you can’t act upon it there and then, mark it as Follow-up and add a note in the Flag To box. When you next look at the email you will know instantly what it is needed to be done without reading the whole email again.

Learn to say ‘No’ in a nice way

As a contractor, you may want to impress your colleagues, or as a freelancer, you may want to show your client how productive and accommodating you can be. However, everybody has a limit on the number of things they can manage to successfully work on during the day. Therefore, knowing how to turn down work without jeopardising the relationship is important. Try saying something like “It is great that you thought of me and I would love to work on the project but I have a couple of urgent deadlines coming up and I am afraid I won’t be able to give your project the attention it deserves”.

Even though the client might be disappointed that you can’t do the job they will appreciate your honesty. It is better to turn down a job down then take it on and rush it through.

Check out our other blog articles for valuable tips and advice.

Running your own business is scary and challenging (some days it can feel like you are climbing Mount Everest backwards). So, finding a bank that is supportive of your business can make your life a little easier.

It is not an easy decision choosing what bank to use. There are many things to consider and it is worthwhile taking your time to look at all the options. In this article, we give you our top tips on how to choose the right bank account for your business.

2 R’s: Research and Review

The starting point is speaking with the bank where your personal account is held. As an existing customer, they may be able to offer you something that is tailored to your business requirements. However, don’t take the easy route and sign up with them without doing further research first.

Take the time to look at different options and see what introductory offers and extras other banks are can offer you. Most banks typically offer between 18-24 months free banking.

You may feel that using a high street bank offers more protection if something does go wrong, but don’t dismiss the smaller lesser known guys. They could offer you a better service or have lower fees.

In the past doing this research could be time-consuming, but the internet means you can now do this in a matter of hours. A good starting point is to check out comparison websites to get an overall idea of what is available and then look into each option in further detail.

Check out what other people are saying. Look on review sites to see what others say about the service they receive. Banks are great at saying how great they are and how customers are at the heart of their business. It’s hard to believe, but yes, this may not be true! There is nothing more frustrating than bad customer service.

Time

Time is key in business, particularly when it comes to opening a bank account. Unlike personal bank accounts which can be opened online. Most business bank accounts have to be done in person. So don’t delay. Once you decide which bank you want to use, make an appointment with the Bank Manager. It can take 2 weeks or longer just to get an appointment to see him or her. From here, it can take another 2-3 weeks to get the account up and running.

N.B Make sure you have registered your business with Companies House first, as you won’t be able to open a business bank account without a company registration number.

Online or in person

It is important to note the differences in how a bank manages personal bank accounts and business bank accounts. With business bank accounts, fees are levied for paying money in, or taking money out of the account. On top of this, banks add-on monthly service fees as well. However, these charges are often lower if you choose to do the majority of your banking online.

If you are not comfortable with on-line banking and prefer to do your banking in the branch then thoroughly research which bank has the lowest transaction fees to avoid paying excessive charges.

Location

If you will be paying a lot of cheques and money into the account then it will make sense for the bank to have a branch that is local to you. You don’t want to be travelling half an hour each time you need to go the bank.

Extras

It is tempting to choose a bank based solely on their introductory offer and switch banks once the offer ends. We advise you look at the longer term. Switching your business bank account every couple of years could infuriate your clients, as they will have to update their payment systems every time you do this.  It will also create extra work for yourself, as you will have to update your invoices with the new bank details every time you switch accounts.

It is also important to consider if you will need extra services from the bank in the future. For example, if you feel later on that you might need an overdraft facility, the bank may be more flexible with existing customers than new ones.

If you need assistance with your company set-up,  speak to us today and we will be delighted to talk you through the different options available.