How to switch over to Intouch – Infographic

Are you thinking of switching over to Intouch from your current accountant? Then take a look at our infographic to see how easy it is…

 

Switching to Intouch

Contractor advice: mortgages made easy

Unless you’re an expert in the area, the world of mortgages can seem like a minefield. With so many providers, terms, rates and industry jargon to get your head around, identifying the best deal for your needs doesn’t come easy.

Things can get a little more perplexing if you’re a contractor. Being self-employed brings with it great freedom and flexibility, but also some uncertainty – and mortgages fall under this bracket.

Buying a property should be an exciting experience and as stress-free as possible. We hope reading this guide will help you in the process.

 

Why is it difficult for contractors to secure a mortgage?

Working as a contractor, your income is likely to vary from month to month. It’s this inconsistency that rings alarm bells with some providers, who factor it in when calculating your ability to sustain mortgage payments.

As a Ltd Company contractor, it’s often more tax efficient to pay yourself a low salary and top it up using dividends, but this can also lead to issues securing a mortgage. A provider, for instance, may not take into account retained profit you already have in your contracting business – profit that proves you could afford a mortgage.

Of course, there are other factors that may see a mortgage application denied – poor credit history, career gaps and undisclosed credit are among these.

Essentially, when your salary isn’t fixed, providers consider it riskier to lend you money. This one-size-fits-all approach certainly doesn’t fall in a contractor’s favour, and it can seem extremely unfair.

Contractors also stand a high chance of being turned down for a mortgage even if they personally approach their own bank, which will only assess their earnings, and often conclude that they have failed the so-called affordability test.

 

How can contractors strengthen their application?

There are a number of things contractors can do to appear more ‘lendable’ to mortgage companies, but they’re not always practical or guaranteed to be successful. Some of these include:

  • Saving up a larger deposit, which from a provider’s perspective lowers ‘perceived risk’
  • Improving your credit score before you start house hunting
  • Obtaining evidence of ongoing agreements with companies to prove guaranteed future work, as well as renewed contracts
  • Limiting time off in the run up to buying a home, as providers may scrutinise you for being out of work for long periods

 

So, what’s the solution?

It may be more difficult to secure a mortgage as a contractor, but it’s certainly not impossible. And actually, with more and more people choosing to go it alone and become self-employed, there has been an increase in the number of bespoke mortgage deals tailored specifically to contractors and their unique needs.

For specialist mortgage deals, you need to turn to a specialist provider, such as Brookson Financial.

Brookson Financial’s in-depth knowledge of the contractor market has enabled them to work with lenders to develop unique products which take into account the distinct ways contractors work and earn money.

The company works with carefully-selected high street lenders to offer unique deals to people like you. You would be assigned your own, personal Mortgage Advisor, who would be responsible for liaising with lenders, estate agents and solicitors on your behalf to save you time. After all, we all know how precious time is when you’ve got your own business to run.

 

From one personal advisor to the next, if you’re looking to switch accountants or haven’t long started out in contracting, with Intouch, you’ll be paired with your own, dedicated Contractor Accountant. It’s their job to help your business run smoothly by taking control of time-consuming accounting tasks you would rather do without, while making sure that you stay on the right side of the tax man.

To find out about any of these services, call us on 01202 375879.

 

How to get started as a contractor – Infographic

If you’d like to know what happens once you’ve joined Intouch as a Limited Company contractor, then take a look at our infographic to see how easy the steps are…

Onboarding for newbies infographic

A handy guide to contractor insurance

If you’re just starting out in contracting, you’ll no doubt have a long checklist of things you need to do before you can reach out to clients. One of these tasks will be taking out quality insurance for your new Limited Company.

We understand that the world of insurance can feel like a minefield, so let us help! The Intouch team has put together this simple guide explaining the types of cover you’re likely to need – but first, that all-important question…

 

Why exactly do you need insurance?

Like any other business owner, contractors need to protect themselves against a number of risks. Arguably the main risk for contractors is a third-party claim against your business – for instance, if a client accuses you of negligence or damage to their property.

Without cover, a single claim could tarnish your reputation and cost you thousands of pounds to put right. It could very well spell the end to your small contracting business.

But also, you’ll find that having insurance is an essential requirement in the contracts you have with agencies and companies. A quality insurance policy will protect you against the unexpected and give you peace of mind with each new contract you take on.

 

The types of insurance you’ll need

Cover comes in all shapes and sizes – here are the types of insurance you’ll need in order to fully protect your Limited Company:

 

• Professional indemnity

If a client believes you’ve done something wrong in your work, known as ‘professional negligence,’ this cover will protect you against the financial implications of them claiming against your company. For instance, it will pay out legal defence costs and damages awarded to the client.

 

• Public liability

As the name implies, this cover is needed if you deal with the public – for example, if your clients visit your office or you work at their premises. It offers protection in the event someone is injured or property is damaged as a result of your work.

 

• Employer’s liability

This protects you against claims made by employees. As you don’t have any employees, you might be wondering why you need it? However, you’ll find that many agencies and clients require you to have employer’s liability cover, alongside public liability and professional indemnity insurance.

 

• Directors’ and officers’ liability

As the director of your own business, you could be held accountable for a number of legislative breaches involving things like mismanagement, health and safety failure or failing to comply with company law. This insurance will cover the financial costs of a claim to make sure it doesn’t take a hit on your bottom line.

 

• Occupational personal accident cover

If you’re injured while working and your business grinds to a halt, it’s almost certain that you’ll be at a financial loss. This insurance pays out a regular sum of money whilst you get better, so that your finances don’t add to your worries.

 

Secure insurance through Intouch

Intouch Accounting has partnered with reputable insurance provider Kingsbridge, which specialises in comprehensive contractor policies. To make things easier, Kingsbridge offers an insurance package which includes professional indemnity cover, as well as public and employer’s liability. You can also boost protection with directors’ and officers’ liability and personal accident cover.

And if you’d like support getting your business off the ground, find out more about Intouch’s services by calling one of our experts on 01202 375293.

 

This blog has been prepared by Intouch Accounting. While we have made every attempt to ensure that the information contained in this blog has been obtained from reliable sources, Intouch is not responsible for any errors or omissions, or for the results obtained from the use of this information. This blog should not be used as a substitute for consultation with professional accounting advisers. If you have any specific queries, please contact Intouch Accounting.

The importance of personal service

We’ve all been there: we call our bank, a service provider or company with a minor query, only to be passed through multiple departments and asked the same questions over and over again. We feel like we’re just a name in a long line of callers – and we can’t help but feel fed up and frustrated when we put the phone down.

In these situations, there’s one important thing missing: the personal touch. And when you’re paying for a service – for instance, from a Contractor Accountant – personal service is something you truly deserve.

Personal service is important because:

• It shows respect. In our opinion, adding a personal touch is part and parcel of offering a quality customer experience. After all, when you entrust in a company to provide a service (and you’re paying for the privilege), you don’t expect to be treated like ‘just another customer.’ You want to feel special – and you deserve to.

• It enhances relationships. You’re far more likely to be satisfied with a company that treats you as an individual – a company that understands your unique circumstances, and offers quality solutions based on your needs.

• It reduces time-wasting. Time’s precious when you’re a freelancer or contractor running your own company. By pairing with an accountant who’s taken the time to understand your unique needs, you can expect to receive expert, accurate advice and support almost straight away, whenever you need it. Less time wasted means a more efficient partnership.

 

Contractor accounts: what to look out for

If you’re just about to set up a Limited Company, or have decided it’s time to switch accountants, ensuring you’ll receive a personal service throughout your professional relationship should be one of your top priorities.

When searching around, an important thing to look out for is if you’ll be dealing with call centres and Account Managers, or if you’ll be paired up with your own, Personal Accountant. In all cases, the latter option is best.

A qualified, expert Personal Accountant will take time to familiarise themselves with your accounts and learn what you want to achieve financially from your contractor pay. They’ll be on hand to offer tailored support, based on your goals, whenever you need it.

 

Intouch: personal, professional

The team at Intouch prides itself on our personal approach to contractor accounting. In fact, it’s the one thing we think really differentiates us from all the other accounting companies – it’s our USP, so to speak.

Choose Intouch and you’ll be partnered with a dedicated Personal Accountant the moment you become one of our valued customers. Their first job will be to get to know you on a personal and professional level, which, in our eyes, is a crucial step in providing a high-quality service.

As soon as your Personal Accountant feels comfortable with the nature of your business and what you want to achieve, they’ll explain how they will help you to reach your goals.

A monthly fee entitles you to unlimited advice from a dedicated Personal Accountant, 24/7 access to our portal for day-to-day accounting tasks, and assistance with duties such as quarterly VAT returns, year-end accounts, payroll returns and self-assessment tax return.

Ultimately, your Personal Accountant is responsible for supporting you with the financial duties owning your own company brings. This means your time will be freed to focus on attracting new customers and growing your flourishing business.

We’ve gained a reputation for our unrivalled service and industry knowledge, and as testament to this have been voted the UK’s Best Small/Medium-sized Contractor Accountant by Contractor UK readers. Start your journey with us today by calling 01202 375 293.

 

This blog has been prepared by Intouch Accounting. While we have made every attempt to ensure that the information contained in this blog has been obtained from reliable sources, Intouch is not responsible for any errors or omissions, or for the results obtained from the use of this information. This blog should not be used as a substitute for consultation with professional accounting advisers. If you have any specific queries, please contact Intouch Accounting.

Working From Home – what can you claim for?

If you use part of your home as an office, you may be able to lower your overall cost of doing business. Here we outline some of the things you might need to know if you intend to claim expenses.

 

Claims

Firstly, you need to think about HMRC. Don’t worry, it’s unlikely to make any enquiries so long as the claim is reasonable and consistent with the type of business being operated. Be wary that not all local HMRC officers follow this approach, so it’s important that you’re prepared to back up your claim if they ask.

A dedicated room or workspace which is exclusively for business use is a must. If it has a dual purpose i.e. dining or kitchen table, then it’s not allowable as a tax deduction.

 

Two common ways of working out how much you can claim:

1. The flat rate method

This is the easiest to work out and doesn’t require any records to be kept or evidence of expenditure. HMRC publishes flat rates each year. The current ‘Home As Office’ allowance from April 2018/19 is £18 a month, making an annual claim worth £208. Not much, but better than nothing, and takes up no time or effort to calculate.

2. The apportionment method

Apportionment is when an expense is ‘split’ between business use and private use, on a basis intended to show the portion of time used for each activity. Apportionment is generally calculated according to the floor area of your home used for business purposes.

The apportionment method splits property costs into fixed and running costs; the amount that you can claim will be based on the portion of use that you have calculated as being applied to your business, and/or the actual cost of the business part of the expense.

For example, let’s say one room in a house with four rooms (bathrooms not included) is used as an office with the following monthly expenses:

Electricity – £60 

Gas – £20  

Council Tax – £100 

Insurance – £40 

Total = £220 

One quarter of the total could be claimed each month, i.e. £55.

(Note that phone calls need to be on a business line, or claimed on a personal line using an itemised bill.)

If you use apportionment, you’ll need to keep all your invoices and receipts as evidence of the costs incurred. By adopting a sensible and realistic approach reflecting your business circumstances, you should be able to successfully handle any HMRC enquiry.

 

Remember:

  • Decide whether the weekly flat rate of £4 or the more detailed apportionment method is best for you. If it’s the apportionment method, review this annually and maintain a record of costs.

 

  • If you only use a table top while your family watches TV, you are unable to claim use of home. However, If you set aside part of your home at specific times for business use, then you are able to claim.

 

These tips are for information purposes and are just a place to start. If you want to know more, we recommend you seek advice from a good specialist Contractor Accountant such as Intouch, who will review your specific situation and provide you with the right advice to make sure you’re claiming all the benefits you’re entitled to.

 

If you’d like more information on Working From Home – download your free guide here.

 

This blog has been prepared by Intouch Accounting. While we have made every attempt to ensure that the information contained in this blog has been obtained from reliable sources, Intouch is not responsible for any errors or omissions, or for the results obtained from the use of this information. This blog should not be used as a substitute for consultation with professional accounting advisers. If you have any specific queries, please contact Intouch Accounting.

Working From Home – where do you start?

Why work from home?

Contracting and freelancing are fast becoming the choice career moves for more employees each year in the UK and it’s evident why. Being your own boss allows more flexibility and the chance for a better work/life balance. Choosing the jobs you want, and when and where you do them is also a great perk. Some might say that they choose to work from home because a relaxed atmosphere increases productivity and efficiency, while others just like to avoid office politics. There are a whole host of benefits to home working, particularly from a health and well-being point of view.

 

Making it work for you

Most contractors prefer a combination of remote and on-site working, to ensure some kind of visible presence, or because they enjoy the variety it brings. But for those wanting to ditch the office environment entirely, these are some things to consider:

 

Advantages

•Arranging your routine to suit you

•Freedom to spend time with friends and family

•Setting up your work space however you like

•No commuting saves time and money

•Less stressful environment

 

Disadvantages

•Distractions such as housework and people who share the same building

•Finding it harder to switch off

•Feeling isolated. If this is a concern, take a look at our infographic for tips on how to make those all-important connections.

 

Setting up a workspace

The beauty of home working is that you can set up your space to suit your needs. You can use a spare room, convenient corner or even under the stairs – technology means workspaces can be much smaller these days, so don’t build that garden office just yet!

Make sure the space is as comfortable and efficient as possible. Get suitable furniture such as a desk at the correct height and a chair, which is good for your posture. Try not to buy expensive equipment to start with – basics would be a computer, printer and scanner – you’ll soon find out what’s essential. It’s also useful to have a smartphone specifically for business, which you can set to voicemail after hours.

And think carefully about colour and decor, which affect your mood more than you might think.

 

Be professional about it

Communication is one of the most important aspects for making homeworking a success, so reliable broadband is a must, as is making yourself contactable and available to speak during working hours. Respond to clients promptly so they know you’re on the job – they’ll want to make sure they’re getting their money’s worth after all. And don’t be tempted to slob around in your dressing gown all day either! Clients will expect exactly the same standards as someone who is office based, and ‘getting ready’ for work will put you in the right frame of mind too.

 

Costs and claims

Due to virtually no set-up costs, working from home is one of the cheapest ways to start a business. If you’re intending to claim expenses through your Limited Company, your home office should be adequately arranged to indicate that it’s a genuine business and not part of your normal domestic arrangements i.e. working from a dining table the family eat at every evening.

It’s also not sufficient to spend a few minutes a week on admin, you actually need to be working at your home office and generating income to justify a claim.

We’ll discuss more about this particular topic in our next blog, but in the meantime a good Specialist Contractor Accountant like Intouch will be able to advise on Home Office Deductions.

 

If you’d like more information on Working From Home – download your free guide here.

 

This blog has been prepared by Intouch Accounting. While we have made every attempt to ensure that the information contained in this blog has been obtained from reliable sources, Intouch is not responsible for any errors or omissions, or for the results obtained from the use of this information. This blog should not be used as a substitute for consultation with professional accounting advisers. If you have any specific queries, please contact Intouch Accounting.

The flexible working ‘movement’: where are we with it?

Today’s complex working landscape presents businesses with the challenge of meeting the demands of people with very different values, expectations and needs. Yet, they all seem to share a desire for flexible working.

It’s little wonder, then, that the flexible working movement has gained such momentum in the last decade. Employers have recognised that the traditional workplace is no longer fit for purpose. But we’re yet to reach a point where flexible working is ‘the norm’, even four years on from the introduction of laws by the UK government which gave everyone the legal right to request flexible working.

 

To use the ‘right to request’ or not

People are still unsure whether or not to use their right to request flexible working, for fear it could be perceived as a sign that they are less than dedicated to their job. In a study conducted by social media training experts Digital Mums last year, more than half (51%) of UK employees believed that asking for flexible working hours would be viewed negatively by their employer and a further 42% thought it would have a negative impact on their career.

Millennials, who are one of the key drivers of the movement, were particularly wary of not wanting to upset their employer, with two-fifths (40%) saying they’d be too nervous or worried to ask for flexible working hours, despite eight in ten (77%) wanting this way of working.

Those fears might very well be legitimate. According to a new joint report from flexible working experts Timewise and consultants Deloitte, more than 30% of workers who opt for flexible hours feel they have less status and importance as a result. A quarter of the 2,000 people surveyed also thought they had missed professional opportunities because of this.

For freelancers and contractors, there aren’t the same lingering fears, although they might have some concerns about whether working remotely could impact on the relationship with the client, if there is an expectation to be on site every day.

 

Remove the need to request

As we revealed in our previous blog on the pros and cons of flexible working, however, any concerns employers might have about what flexible working could do for business are often shown to be ill-founded.

Ask anybody who works flexibly whether they work harder and more productively now than they did when they were in a more structured setting and the answer would be unequivocally ‘yes’. Flexible workers often say they feel like they owe it to their company to go beyond the call of duty every day. While that brings up another issue entirely around work/life balance – another main driver of the movement – it goes to show how much staff value flexible working.

In a recent piece of research by SmallBusinessPrices.co.uk, more than a quarter (28%) of respondents said they value additional holiday days, sabbaticals and flexible working hours as employee benefits, over receiving a pay rise.

By promoting flexible working – rather than making employees request it – employers could find themselves with a line of new talent at the door, while holding onto the existing talent they already have in the building.

It could even help end gender discrimination in the workplace. According to the Timewise/Deloitte report, one of the biggest barriers to gender equality and pay parity is employers’ continued refusal to accept non-traditional working practices.

Timewise chief executive Karen Mattison stresses that the family structure in which one person stayed at home and another went out to work is “no longer the case for the majority of UK households” and employers need to react by changing their flexible working practices.

With the technology available today to facilitate flexible working, it’s never been a better time for individuals to dictate how long, where and when they work. More and more people are taking the plunge and ‘going it alone’ as either a contractor or a freelancer.

Of course, with Intouch Accounting by your side, you’re never alone. We are here to support you by answering any questions you may have, from assessing whether it’s the right time for you to contract or freelance, to helping you set up a Limited Company.

 

 

This blog has been prepared by Intouch Accounting. While we have made every attempt to ensure that the information contained in this blog has been obtained from reliable sources, Intouch is not responsible for any errors or omissions, or for the results obtained from the use of this information. This blog should not be used as a substitute for consultation with professional accounting advisers. If you have any specific queries, please contact Intouch Accounting.

Flexible working: Pros and cons

There’s no doubt that we’re now living in the era of flexible working. Of course, for contractors and freelancers, this trend of choosing how long, where and when you work is nothing new, but now it’s not just the self-employed who are empowered to manage their schedules.

In the UK, nearly-two thirds (64%) of employees now work flexibly, according to the ‘2017 Flexible Working Survey’ by Ten2Two. However, it seems that employers are still a little reticent to fully embrace the flexible working revolution, with Timewise’s 2017 report revealing that less than one in ten jobs paying over £20,000 are advertised as being open to flexible working.

So, why is it that firms are somewhat unsure about whether or not to promote flexible working to staff? Like anything, flexible working has its pros and cons. We’ll start with the cons:

 

1. Could hinder productivity

Organisations are concerned that giving everybody a degree of freedom in deciding how work is completed will result in reduced productivity for both individuals and teams. Even if employees are just 5% less productive working remotely, it’s going to start adding up once you think about it collectively. Meanwhile, for those who are self-employed, a day of distractions at home could mean that you have to play catch up at the weekend.

 

2. Feelings of isolation

Flexible working sounds good in practice for individuals, but the reality can be very different. For some people, too many consecutive days working solo can lead to feelings of isolation, particularly if communication with the ‘outside world’ is lacking. A good support network is essential so that individuals don’t feel like they have nowhere to turn should they need to. Meanwhile, from an employer’s perspective, a lack of collaboration between colleagues could limit the cohesiveness of teams and the sharing of ideas.

 

3. Work intensification

Flexible working often blurs the line between work and home, to the point where individuals struggle to switch off at the end of the day – an issue all contractors and freelancers who work remotely wrangle with. For the sake of work/life balance and productivity, individuals need to feel like they can pack work away for the day and not like they owe it to their company to go beyond the call of duty every day.

 

However, few would doubt that the pros of flexible working far outweigh the cons. In Ten2Two’s survey, 83% of employers agreed that flexible working had benefited their business. Here are the main arguments for adopting the trend:

 

1. Work anywhere remotely

Perhaps the benefit you most associate with flexible working is the ability to work remotely, away from the traditional office environment; be it at home, in a cafe, library, shared space, or even in a foreign country. Find the environment that brings out the best in you – if that’s at home, make sure you ‘craft’ in a way that means you can get stuff done.

 

2. Less stress + fewer sick days = increased productivity

Workplace politics can be a real problem if they are rooted in manipulation or gossip. Flexible working can help to minimise office politics, so the potential for conflict and any resulting occupational stress decreases. As stress decreases, so will the number of sick days employees take in the working year. This has obvious benefits to employers in terms of greater productivity, but it’s also valuable for freelancers and contractors who might have to forfeit a day or two’s work if they’re too sick to get out of bed.

 

3. Greater convenience for life priorities

Everybody has different priorities in life. For some people, their children will be the priority; for others, it might be sports and keeping fit. Flexible working gives us a better chance of being successful at what matters most to us. For example, having a flexible schedule means you can take an hour out to pick up the kids from school and do the food shopping.

Ultimately, flexible working works for some people, but others may need a bit more structure.

If you’re considering a flexible approach to work and think contracting is for you, Intouch Accounting are here for support by answering any questions you may have, from assessing whether it’s the right time, to helping set up a Limited Company.

 

This blog has been prepared by Intouch Accounting. While we have made every attempt to ensure that the information contained in this blog has been obtained from reliable sources, Intouch is not responsible for any errors or omissions, or for the results obtained from the use of this information. This blog should not be used as a substitute for consultation with professional accounting advisers. If you have any specific queries, please contact Intouch Accounting.

IR35 in the private sector – HMRC announces consultation

In last Autumn’s Budget, the government announced that it would consult on how to tackle non-compliance with IR35 rules in the private sector. On Friday, HMRC issued this eagerly-awaited consultation which they say “looks at improving the rules around ‘off-payroll’ working so contractors who work through their own company pay the right tax.”

At Intouch, we would suggest that HMRC learn from the negative feedback following the public sector reform and at the same time, remember that private sector and public sector hirers are different entities with different motivations and potential responses. They engage with their clients in different ways and often at different levels and as such we’d encourage HMRC not to view them as the same with respect to off-payroll rules and deemed employment. Input should be taken from across the industry with a view to tailoring a bespoke private sector solution that improves compliance whilst mitigating any potential administrative burdens.

The consultation timescales mean that any changes could be introduced as early as April 2019, although we’d urge HMRC to take the time to consider timings very carefully to avoid any negative impact to the UK economy as we move forward with Brexit.

Intouch will be responding to the consultation and we encourage all other interested parties to contribute; that means contractors as well as end-hirers who want to continue to have access to and support self-employed contractors. You can see the consultation and how to send your response here – you have until 10th August!

If you want to have your say but need to brush-up on your IR35 knowledge, check out our resources below:

Guide – Embracing IR35
Infographic – IR35; Don’t panic!
IR35 FAQs

 

This blog has been prepared by Intouch Accounting. While we have made every attempt to ensure that the information contained in this blog has been obtained from reliable sources, Intouch is not responsible for any errors or omissions, or for the results obtained from the use of this information. This blog should not be used as a substitute for consultation with professional accounting advisers. If you have any specific queries, please contact Intouch Accounting.