This is a good option for some dentists as it can help to save more tax than if you’re self employed.
Total limited company cost per year:
Market price: £950 – £2,750
Small Biz price: £1,045 – £2,200
There are a number of separate services you’ll need from your accountant to run a limited company. Some accountants will give you a single package price for all of these, or you may get a breakdown of the price for each service.
Software
Traditionally, you would send your bank statements and documents by post to your accountant each year.
However, there are now accounting software packages that can access your business bank account directly. Both you and your accountant have access to the software and your accountant will use it to prepare your annual accounts.
Xero and Quickbooks are examples of this software.
Price per year: £72 for a basic subscription
Annual accounts and company tax return
Your company must prepare a set of accounts each year to submit to Companies House and HMRC. They need to comply with current accounting standards which dictate how your income and expenses are determined, the layout of accounts and any notes or additional information to be included.
The higher your income, the more complicated it becomes to prepare your accounts. An increased number of transactions means more data needs to be checked and will mean more queries from your accountant.
If you use a software package, all the bank transactions need to be matched to a type of cost (e.g. training, tools, etc.). If your accountant has to do this, then they will charge more for the extra work, but the costs will reduce if you enter all this information yourself.
You also need to send a company tax return to HMRC. Your accountant will use the information from your accounts and then make adjustments to calculate the correct tax. If you have a director’s loan from your company, then an extra form needs to be prepared and included with the tax return.
At SmallBiz Accounts, we also include in this service specific advice on how to retain and/or take your money out of your company to save as much tax as possible, taking in to account your personal circumstances and careful use of tax-free allowances and reliefs.
Market price per year: £600 – £1,500
SmallBiz price per year: £800 – £1,300
Payroll
As all your income is going into your company, you then need to get it from the company to you personally. The first step is to pay a salary to yourself (and possibly your spouse or relative). Your accountant will set up the most tax efficient amount. They will submit all the payroll information to HMRC, send payslips and other documents to employees and deal with any queries from HMRC.
Price range per year: £70 – £180 per person getting a salary from your company
SmallBiz price per year: £72 – £144 per person getting a salary from your company
Dividends
This is the second most common way to take money out of your company. Dividends have to be officially agreed by the directors and vouchers issued to the shareholders. An accountant will normally advise you on the most suitable amount of dividends for that tax year, and how much tax you’ll pay. They will then prepare the documents for you to sign and update your accounts.
Market price range: May be included in the cost of your annual accounts, otherwise up to £70 per dividend
SmallBiz price per dividend: £43
Personal tax return
When you receive dividends from your company, no tax is deducted. Therefore, you need to complete a self-assessment tax return to calculate how much tax you owe.
An accountant will gather information on all your income for the year (salary, dividends, interest, rental income, etc), plus any capital gains (where you’ve sold an asset such as a property or shares). They’ll complete your tax return and submit it to HMRC. If there are any queries from or errors by HMRC, your accountant will deal with these and make sure you pay the right amount of tax.
Market price per year: £120 – £500
SmallBiz price per year: £180 – £400
Registered office
The registered office of the business is the official office of your company and is available for the public to see on Companies House website. If you don’t want your home address to be published, then you can use a registered office service, with government and legal mail forwarded to your home address.
Market price per year: £35 – £85
SmallBiz price per year: £72
Confirmation statement
This is an annual form to be submitted to Companies House giving details of the company address, directors, shareholders and activities of the business. You accountant will check with you that the details they hold are correct, and then submit to Companies with the filing fee (currently £13).
Market price per year: £35 – £70
SmallBiz price per year: £58
Fee protection for tax investigations
HMRC may choose to investigate any taxpayer. To safeguard you against the Taxman, fee protection insures you against any accountant’s fees that may arise if HMRC enquires into your tax affairs. It should cover all your business and personal tax affairs.
Ordinarily, if your accountant claims for their costs under this policy, the VAT on these fees is payable by you because the insurance policy does not cover the VAT. However, at SmallBiz Accounts, we absorb the VAT cost and don’t charge it to our clients.
Market price per year: £99 – £300
SmallBiz price per year: £115
