Hi!
So I have a part time job which pays me around £19000 a year. I have just set up a limited company doing agency work which I estimate will bring in around £2500-£3000 per month.
My accountant has advised that I take a directors salary of £758 per month from this. I understand that I need to register as an employer and there's a significant amount of work to be done each month to generate a payslip.
My question is, will it be worth the hassle? Or I can pay my accountant around £20 per month to do it for me. Or shall I just take the cash out as dividends and pay the dividend tax on this
Thanks in advance!
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Replies (22)
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You pay your accountant for a reason, if you don't trust their advice, find a new one you do trust.
Based on the very brief info here, his conclusion does not sound unreasonable, he can explain the maths and savings possible so you can compare to the costs
Thank you. I was only asking on here as I am brand new to the business/ accounting/ tax world and just wanted to seek a second opinion to help me understand what I am doing.
It's amazing how many posters here want a second opinion when they don't understand the opinion they've already been provided with.
Why is two opinions you don't understand better than one?
I appreciate what I'm asking is very basic, but if what you're going to say isn't going to assist or educate me then why not just scroll past and not waste your time and effort on replying.
Also, as I stated in the question, she has given me the option of either doing the work myself or paying her to do it. This is the advice I was looking for.
if what you're going to say isn't going to assist or educate me...
You want me to teach you something? Look up Segal's law.
My view? Pay the £20 a month, get it right. (That's just my view, mind.)
I had never heard or it, the law that is
But I think it is true that 5 accountants, given the same records, would give 5 different profit figures
Thank you. I was only asking on here as I am brand new to the business/ accounting/ tax world and just wanted to seek a second opinion to help me understand what I am doing.
Ask the person you are paying to “help you understand”. Any half decent accountant should be making sure you understand in the first place.
This is the first time in my life I have had to use an accountant, so I thought double checking what she is saying is a sensible thing to do instead of blindly going forwards on her advice with no idea what I'm doing. Surely, seeing if other more knowledgable people in the field agree then that gives me a greater evidence base.
Also, as I stated in the question, she has given me the option of either doing the work myself or paying her to do it. This is the advice I was looking for.
Also, as I stated in the question, she has given me the option of either doing the work myself or paying her to do it. This is the advice I was looking for.
So you’re asking a load of people who you don’t know and who don’t know you (and your tax and accounting capabilities) whether your personal preference is to do some work yourself. Have I got that right?
"Surely, seeing if other more knowledgable people in the field agree then that gives me a greater evidence base."
1. You've no idea (nor does anyone) whether advice you receive on a public forum is from people more knowledgeable than your appointed accountant.
2. You may end up with a larger (but not necessarily greater) evidence base - but to what purpose?
3. You are quite entitled to seek 2nd opinions, but it may not be worth your while to do so (and as per above) you may end up less clear as to what is 'correct'.
For instance, you can take the same approach to anything (medical diagnosis, car maintenance, choice of partner, etc) ... but often just end up more confused.
FWIW, you ask about "the option of either doing the work myself or paying her to do it" ... and my answer is pay her - if only for the simple reason that, in your own words, you're new to all this and don't know how to do it all correctly.
If in the future you think you could get someone else to do a better or cheaper job (or even 'have a bash' yourself), then at least you'll be starting from a clean base.
:-) Though more likely the dumbing down Americanisation of our language. Notice how many also interject sentences with "like," and an upward intonation at the end of each sentence.
If the question is really:
Is the wages fee reasonable? then yes it is
I would really not want someone trying to get wages done themselves unless they have done it recently and buy good software, with a working support helpline
Ive said it before, but I will say it again, if you want a second opion - PAY FOR IT!!!!!
This is not a free advice forum for business owners.
Ive said it before, but I will say it again, if you want a second opion - PAY FOR IT!!!!!
This is not a free advice forum for business owners.
Bizarre, isn’t it?!