Accountancy Services Provider - a firm of accountants offering a wide range of financial services to assist in the running of your business. Typical services include accounting, book-keeping, VAT, payroll processing, completion of management accounts and tax returns, legal services and data entry. Look for an accountancy services provider with experience of working with contractors and with qualified accountants amongst its team.

Accounting - the collation of financial information for interested parties about an organisation's financial performance, assets and liabilities.

Book-keeping - the recording of the financial accounts of an organisation. These accounts may be recorded manually or stored electronically on a computer system.

Accountant - unfortunately anyone can call themselves an accountant. There are however a number of recognised qualifications: ATT, ACA, CIMA and ACCA are all examples of recognised accounting bodies and a "proper" accountant will be a member of one of these bodies.

Corporation tax - a tax on the profits of UK-based companies and organisations. The small companies rate of corporation tax is 21% for 2008/9.

Gross pay - the total amount earned, before employee's NICs, PAYE and other deductions.

HMRC - Her Majesty's Revenue and Customs, formerly known as the Inland Revenue and HM Customs and Excise which are now a single body.

Income tax - the tax levied on monies received by an individual during a tax year from earnings, investments and profits.

Limited Company - a legal structure where the shareholder is protected from any liabilities the company may incur.

Managed Service Company - an individual limited company which is involved with a Managed Service Company Provider (see below).

Managed Service Company Provider (MSCP) - a service company that provides companies with services which could be seen as "influencing" (possibly even controlling the running of the company and operating its bank account). Under new rules that came into force in the 2007 budget, Managed Service Companies (those companies involved with an MSCP) must deduct full PAYE and NICs on all income paid to their shareholders.. If you are currently involved with an MSCP and are at all uncertain about its legality, please contact us immediately for advice.

Net pay - the remaining amount of income after employee's National Insurance, PAYE and other deductions have been made from your salary.

NICs - National Insurance Contributions.

IR35 - the HMRC tax legislation which seeks to ensure individuals are not disguised employees of the end client, simply by using an intermediary company, commonly a Personal Service Company (PSC), to provide the worker. Individuals within IR35 are effectively in deemed employment and must therefore be paid salaries subject to PAYE and NICs. Individuals outside IR35 can elect to receive their remuneration as a mix of salary and dividends.

P11D - the HMRC (Expenses and Benefits) form that is filled in by UK employers for each director and employee earning over £8,500 per annum, detailing any expenses and benefits in kind received by the employee.

PAYE - Pay-as-You-Earn, the payroll deduction system whereby income tax is deducted from an employee's salary. The amount deducted is established by their tax code and is designed to try to collect the correct amount of tax over the tax year.

VAT - Value Added Tax, the charge levied on the final consumption of goods and services. Umbrellas - these companies theoretically contain from one to an unlimited number of contractors who are all employees receiving a salary and paying PAYE and NICs on all earnings. Some expenses are tax deductible. Contractors are not directors or shareholders so cannot receive dividends. There is usually no distinction between the managing company and the umbrella.

PayStream are unique in the accountancy services market as we offer a real choice of umbrella solutions. Please visit our Services section or contact us for full details. If the term or phrase you're looking for isn't listed above, please call us for an explanation on 0800 027 2340.

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