What Is a Contractor Accountant?
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A contractor accountant is an accountant who specialises in doing the accounts of freelance workers. In many cases these freelance workers are referred to as contractors rather than freelancers.
They are employed by a company to complete a specific task. Once that task is done they move on and find another job. Usually with another company although in some cases they will start a new job for the same company. In the UK they represent a growing segment of the working population. This is because UK employers are seeking to keep their costs to a minimum and maintain as flexible a workforce as possible.
Do You Need a Contractor Accountant?
If you work as a contractor or freelancer the chances are you need the services of a contractor accountant. As a basic rule of thumb if you pay your own tax and NI contributions you are considered as either self-employed or as a contractor.
In theory, you can complete your own tax return and pay the necessary tax and NI contributions and before 2000 this was really easy to do. However, in 2000 the government brought out a piece of legislation known as IR35, which considerably complicated things for the self employed.
IR35 sought to uncover those people who were working as ‘disguised employees’ and make them pay more tax. Disguised employees are people who work for a firm year in year out doing the same job, taking holidays etc, but claim to be self employed contractors. These people and the employer pay far less tax, which the UK government wanted to stop them from doing. Unfortunately, this legislation makes it very hard for genuine contractors to avoid being considered as an employee and having to pay more income tax as a result. Also leaving them open to prosecution if they did not understand the rules and failed to pay the right level of tax.
As a result it is now far wiser to find a good contractor accountant to complete your tax return and to help you to avoid signing new contracts that make you liable to pay more tax. |
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Author Resource:-
Beever and Struthers offer a great contractor accountant service. Their freelancers and contractors team provides a bespoke service that is suitable for people working in all industries.
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By :
Gareth Hoyle
Submitted
2011-11-12 04:30:48 |
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