As one of the world’s leading financial hubs, London has ore contractors and contractor vacancies than any other city with positions across IT and telecoms, hospitality, tourism, retail, financial and banking sectors.

However, because competition for these well-paid positions is always fierce, managing the books is often the last thing on the minds of any would be contractors. That is, until they fall within IR35 legislation. But there are many ways that contractor accountants in London can help you prevent this.

Intermediaries Legislation 35 (IR35 for short)
Because the IR35 rules are constantly changing, many contractors have fallen inside the IR35 and been required to pay more tax on their earnings than they should have. Typically this is due to the contractor in question having never taken the time to manage their books properly or have them looked at regularly by an accountant.

Ironically, the Intermediaries Legislation 35 was intended to prevent people from abusing the tax relief system by forming their own companies and disguising themselves as employees while reaping all the benefits of owning a limited company. However, since then, IR35 has undergone a number of judicial changes, leaving the exact rules open to interpretation.

In order to stay out of IR35, all you need to do is clearly demonstrate through documentation to the HMRC that you are a self employed contractor. Contractor accountants can also offer more detailed advice about the IR35 as well as any benefits if you do fall within it.

Meanwhile, you need to accurately manage your accounts and keep all your receipts to claim expenses. This is essential for an accountant to help you make the most from your earnings and stay safely outside of IR35.

Going forward, a good contractor accountant will also be able to teach you how to manage your books more efficiently, claim for expenses, save even more money by paying yourself in dividends and even create a pension pot as a means of accumulating tax free funds in order to purchase property for your business.

With so many tax tricks and other loopholes that only a savvy accountant would know, helping you to avoid IR35 is just the tip of the iceberg when it comes to what an accountant can offer you.

Simply start by invoicing your client and when they pay you into your corporate bank account, move some money over for your salary and then decide how much you want to draw down for your profits.

At this stage you might decide to leave some of it in your company for tax planning. Although as a contractor you will want to take after tax as much as possible.

If you are working through a Limited company you are likely to after tax take around 75% to 80% of your contract value whereas if you have set up an Umbrella Company, you would be looking to take before tax approximately 60% to 65%.

Generally contractors will run a short contract of under 3 months through an Umbrella company while anything over three months or on a particularly large rate may be worth going through a limited company. Although as always, it’s best to speak to your accountant about the pros and cons as well as how they would best manage your accounts.

Using an online take home pay calculator is the quickest way to get an idea of pay for you. After putting in an hourly or daily rate the calculator does the rest. The take home amount assumes full tax planning and a number of other aspects which would need to be discussed with an accountant.

Why not try this online tax calculator for free and make it easy for yourself?

A contractor calculator will give you a more accurate figure based on your current situation in just a few minutes and can also be useful when trying to make the indecisive decision between limited company and umbrella. Ensuring you are using the correct type of contractor calculator, most websites offer you a total figure excluding all the necessary tax to be paid.

Contractor UK and SJD Accountancy have a useful array of contractor calculators on their website allowing you access to a contractor calculator for pretty much any situation including VAT calculators, payslip figures, fuel costs and many more.

Unfortunately, if you’re not careful with these types of cards, you could also find you end up in more debt than you expect. Banks can be quite crafty with the way they word their offers. Always make sure you understand exactly what you’re getting into and then stick to your plan. You’ll save plenty of money this way.

Here are some ways you can get the most out of interest free credit cards.

Interest Free Purchases

0% purchase credit cards sound like the ideal solution. You get to charge your purchases on plastic and not have to worry about exorbitant interest charges adding onto your original debt balance.

Yet, not all credit cards offering a zero per cent deal work in exactly the same way. In order to really see zero interest charges on the things you’ve purchased with your card, you need to double check that your card offers 0% on purchases made, and not just offering no interest on balance transfers.

Check the Introductory Term

Many interest free credit cards only offer the 0% interest option for an introductory term. Always check exactly how long you have to benefit from paying no interest on your credit card debt before you proceed.

Some credit card providers only offer interest free purchases for three months. This means you might purchase something on the 1st of January and have until the 1st of April to repay that purchase amount without any interest being charged. If you don’t repay that amount, interest will begin to accrue on your outstanding balance.

Other providers may offer introductory terms on balance transfers that extend for a far longer term. Always check which suits your own financial situation.

Check the Rate after Expire

Once your introductory interest free term has ended, your credit card provider will begin charging interest on any remaining balance you haven’t paid off. If the rate reverts to a very high interest rate after your interest free period ends, you could end up paying much more for your purchases than you expect.

Interest Free Balance Transfers

One of the biggest benefits to using an interest free credit card is when you use it to reduce your interest bill on outstanding debts you have on other cards. Paying 0% on your current credit card debts can be an excellent way to reduce your monthly repayments and boost your cash flow. This is especially true if you’re currently paying outrageously high interest rates.

However, it can also be the ideal opportunity to begin working on debt reduction plans properly.  You simply transfer your outstanding balance from your high interest cards over to your new interest free balance transfer credit card. Always make sure you really are capable of repaying the amount you transfer before the interest free period expires. You might want to think about a longer zero per cent interest term or maybe even consider transferring less.

Now, take a close look at exactly how much you pay on your current credit card bills every month. Then look at how much of that payment is eaten away by interest charges. Very little of your payment goes towards reducing your debt

Yet, if you paid the same monthly repayment but didn’t have those interest charges eating it away, your debt balance would reduce much faster. As long as you don’t keep adding to your debt, choosing an interest free credit card for a balance transfer over a long term can make it easier to pay off your credit cards once and for all.

First Step into becoming a Contractor

The first thing you need to do when making the move to contractor is to simply; find a contract. You may not think that there are many contract roles out there due to the current economic climate, but you’d be wrong. Companies are now looking to hire people short term, then support them long term.  Important things to do:

• Update your CV – Focussing on key skills that help you stand out as a contractor whilst talking about recent employments and achievements within
• Target Recruitment agencies that specialise in your chosen field.

Limited and Umbrella

There are two ways to function as a contractor – limited and umbrella. Limited companies are ideal for contracts of 3 months or more and when annual take home money is £25,000 plus. Umbrella companies are basically the opposite – working for people with short term, low value contracts.

• Umbrella – take home pay between 60%-65% of your contract value (Not much different to working as a permanent employee).
• Limited – take home pay between 75%-80% of your contract value, however there is far more paperwork and legal issues to take note of.

IR35

On finding a new contract, the next step you need to take is to establish your IR35 status. Before signing your contract you need to check whether you fall inside or outside of IR35 legislation – otherwise you may be finding yourself in hot water somewhat. If you find yourself within the legal boundaries of IR35, in simple terms you will take home significantly less money. So, you can see why it would be more sensible to operate through a limited company, if you are inside IR35, claim expenses, reap the rewards from the Flat Rate VAT scheme and ultimately only pay tax on 95% of your contract. Using a specialist contractor accountant can help you with this.

You should always ask around when selecting a contractor accountant, and remember that it is better to find a specific accountant to your field of work. It is essential that you find a contractor just for you, and take your time selecting one – it should not be a rushed haphazard decision. Look for firms that have been established a while and are backed by credible third party claims. It is also possible to see how successful a company is purely on the amount of awards they have accumulated from organisations such as Accountancy Age, National Customer Service and PCG.

Another problem in borrowing from bank is the quantum of loan. Below a certain amount, lending becomes non-viable for banks. This is because there are establishment costs, employee costs, due diligence costs, etc., that the bank incurs. Some of these are distributed proportionately on loans, while others are loan specific. The total of such costs have to be recovered from the deal earnings. If the earning from the transaction is not likely to fetch returns that are enough to cover such costs, then the bank chooses to forego such lending even if the borrower is reliable and has a good credit score. This lost opportunity costs the investors quite a bit. Their funds remain idle till another borrower who qualifies in all respects is found. When profits earned on all transactions are averaged for the entire year, these zero profit periods bring them down. Therefore, resultant returns to the investors in the bank are lower because of these idle periods. In peer to peer lending such losses are minimal.

This is because Peer to Peer lending is much more personal. Here, the lender knows the borrower or a group of borrowers, as the case may be. In banks, lenders or investors are represented by the bank. Therefore, they do not know the borrower in person. Internet is one of the reasons for Peer to Peer Lending’s growing popularity. The other reason is the recessionary trend, and lack of liquidity all around. In this scenario, people may need monies for different reasons such as managing their debts, paying their bills, or clearing their credit card dues. Whatever be the reason, the lender is likely to judge them based on personal risk appetite and not a uniform risk appetite. The borrower is also at liberty not to disclose the reason for him or her needing that loan.

Internet has become a big facilitator of peer to peer lending. Both borrowers and lenders can use peer to peer lending sites. There are ample peer to peer lending sites. It is, however, not essential that all peer to peer lending businesses have same business models. Some sites facilitate direct lending, while others have indirect lending mechanism built in them. Direct lending implies the lender selects the person based on his or her requirements. Unlike banks, people from different locations across the world can access the monies or lend monies in peer to peer lending system. Of course, there is credit rating to go by. But the risk is almost entirely in the lender’s court. Lender may choose to distribute the risk over several borrowers whose credit rating is similar. Indirect lending is similar to the system in banks. Almost all costs in peer to peer lending are lower, partly due to Internet. Because of this, borrowers can get finance at a cheaper rate, and lender can still earn returns that are higher than what he or she would earn by investing the monies in bank.

Anyway, one morning I decided that I would chuck it all in and become a full time do it yourself man and six years later I haven’t looked back. I have am independent in mind and body, I love my work and I’m probably a better person for it. I have had to become financially literate and now know my income protection policy from my permanent health insurance and my VAT rates from my National Insurance thanks to life insurance compare.

Source: http://lifeinsurancecompare.uk.com/blog/2011/12/14/i-saved-small-fortune-life-insurance-life-insurance-compare-website/

Source: http://lifeassurancecover.uk.com/blog/2011/12/13/life-assurance-cover-website-saved-us-most-money/

Source: http://mortgageprotectionquotes.org/blog/2011/12/02/i-spent-over-2-hours-looking-genuine-online-mortgage-protection-quotes-last-i-found-genuine-site-named-mortgage-protection-quotesukcom-about-time/

FREE…is the word to make everyone wonder if he or she should click the link or not. We all know that nothing in life is free and we wonder why promotional advertisers hang up the slicks claiming to offer 0 APR credit card offers. Well, perhaps something’s are free.

Nevertheless, when we see 0 APR credit card offers it prompts us to check it out…What they really mean is that they are offering no annual fees, or deposits. You sign up for the card online and wait until the lenders run a credit check and you get your answer. Nothing truly is free.

When you get the card you have to pay certain amounts of interest, however, some cards offer cash back and points to their users, which you can use to reclaim the interest paid on your credit cards.

The 0 APR credit card offers may offer you the 0% Introductory Rate and benefits with the package. If you think about, 0 APR credit card offers, you may realize that the cards can come in handy. A credit card from where I am standing can offer you a bit more; that is if you don’t make a mistake and apply for a card through the wrong lender.

Seeking a 0 APR credit card offers of your choice is not as difficult as people may think when you compare online. However, since the Internet, credit cards are easy to come by. Some cards have advantages others do not have. It makes perfect sense to compare before committing to a lender. The lenders are people who make money every time someone signs up and uses the credit cards. Keep this in mind when you are looking for the free online credit cards and you will succeed.

With renewed impetus I did the same for other financial service products I pay more regularly and within a matter of a few hours I had radically reduced my monthly outgoings. It’s a curious feeling having made such a seismic change to ones finances. Do I regard the savings as new money or old money I’ve wasted in the past? One thing’s certain; if you don’t do this straight away you’re only costing yourself money. I would hazard a guess that I have saved enough to pay for a holiday with the combined saving I have been able to make.

Source:  http://www.permanenthealthinsurance.uk.com/blog/2011/11/18/permanent-health-insurance-can-now-be-bought-online/