Accountants for
Limited Companies

Sometimes. If your customers are VAT-registered businesses, they reclaim whatever you charge, so registering lets you recover VAT on your own costs at no real cost to them. If you sell mainly to the public, registering voluntarily means either raising prices by 20% or absorbing it.

The other consideration is admin: quarterly returns and digital records are an ongoing commitment. We will tell you honestly if it is not worth it yet.

Under the Flat Rate Scheme you charge customers the normal 20% but pay HMRC a lower fixed percentage of your gross turnover, keeping the difference. In exchange you generally cannot reclaim VAT on purchases apart from certain capital assets over £2,000.

It suits businesses with low costs relative to sales. If you buy a lot of standard-rated goods or services, ordinary VAT accounting is usually better. Watch out for the limited cost trader rate of 16.5%, which removes most of the benefit for service businesses with minimal purchases.

HMRC’s points-based system gives you a penalty point for each late return. Once you reach the threshold for your filing frequency — four points for quarterly returns — you get a £200 penalty, and a further £200 for every late return after that.

Late payment is separate and charged as a percentage of the tax outstanding, increasing the longer it goes unpaid, plus interest. Points do expire after a period of compliance, so getting back on track does eventually clear the slate.

If you draw a salary, yes. You need a PAYE scheme and RTI submissions even where the salary is below the threshold at which tax and National Insurance become payable, because it is the reporting that is required rather than the payment.

Most director-only companies pay a salary set around the National Insurance thresholds because it is deductible against corporation tax and preserves a qualifying year for the State Pension. That still needs reporting properly.

You must assess every member of staff on each pay run and automatically enrol anyone aged between 22 and State Pension age earning over £10,000 a year. Minimum contributions are currently 8% of qualifying earnings in total, of which at least 3% must come from you as the employer.

You also have to re-enrol eligible staff who previously opted out roughly every three years and submit a declaration of compliance. We handle the assessment and the pension provider uploads as part of running your payroll.

By the 22nd of the following tax month if you pay electronically, or the 19th if you still pay by post. Small employers whose average monthly liability is under £1,500 can arrange to pay quarterly instead.

We tell you the amount and the deadline every period, so it is never a guess.