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How to avoid a limited company nightmare

Paystream News

Kerry Hull

Thursday 3rd Nov, 2016

Scared of missing a tax return deadline? Terrified of not making a good impression on your clients? Horrified at the thought of not being able to achieve the perfect work-life balance? Having nightmares about your paperwork mountain?

Don't panic, as there's no need to be scared if you're managing your workload in the most efficient way, and PayStream is here to help you manage the scarier aspects of running your own limited company.

Here we take a look at three scary scenarios that we can help limited company contractors navigate their way through.

Scary scenario 1: Work is taking over your life, and you have no time for your loved ones!

Research carried out by PeoplePerHour in 2015 led to the discovery that over one-fifth (21.7 per cent) of UK contractors and freelancers decided to leave traditional employment and work in this way instead in order to gain greater control over their working hours and create an improved work-life balance.

But what if you suddenly find that your limited company is taking over your life, and you're not spending as much time with your loved ones as you would like? On the one hand, you need to be putting in the hours to make your new career choice a success, but on the other, it's unlikely that you'll be fully satisfied with your decision if you aren't able to work as flexibly as you imagined.

If you do find yourself in this situation, it's important to take a step back and think about where you could make improvements to the way you organise your working hours to make them as productive as possible. Decide on a time that you're going to finish each day and stick to it, and don't check your work emails or take professional calls during your free time. If you feel that you're spending too much time commuting, consider working from home instead, and your work-life balance should start to improve.

However, if you still need to gain back a few extra hours for family time, PayStream's My PSC limited company service is on hand to provide help and advice with the time-consuming administration that comes with running your own limited company, providing you with more time to spend completing contracts so you can switch off and enjoy time with your loved ones.

Scary scenario 2: You've missed your self-assessment tax return deadline!

Each year, HMRC announces the deadline by which limited company contractors, freelancers and other self-employed individuals have to submit their self-assessment tax returns, and all those who miss this are automatically faced with a financial penalty. With this in mind, it can be a pretty scary situation if you miss the deadline, particularly if you don't have the funds in your limited company account to pay it straight away, as the fine increases over time.

HMRC will drop the penalty if you can prove you have a reasonable excuse for missing the deadline, such as an unexpected stay in hospital, the death of a partner, a fire or service issues with the tax body's online submission portal.

However please be ware that HMRC will see right through any far-fetched reasons you come up with; in 2015, the organisation revealed some of the most feeble excuses it has received in the past, which included 'my pet dog ate my tax return, and all the reminders', 'I fell in with the wrong crowd' and 'I've been busy looking after a flock of escaped parrots and some fox cubs'.

If the thought of completing your self assessment tax return sends your stress levels through the roof, PayStream's Tax Team are on hand to ensure your self assessment tax return is not only completed on time, but also correctly to avoid those HMRC fines. They will also help you chase any overpaid tax that you may be due, whilst giving advance warning on any potential tax liabilities.

Scary scenario 3: No one is approaching you with contracts you want to work on!

Contractors need contracts - forgive us for stating the obvious - but if you're not being approached with opportunities that you're interested in, working for yourself is unlikely to be as fulfilling as you initially envisaged. Even if you're putting yourself forward for dozens of contracts of your own accord, there will be some that you miss out on or some that you simply don't enjoy quite as much as others.

This is why it's important to make sure your social media presence is as professional as possible, with your Facebook, Twitter, LinkedIn and even Instagram clearly detailing your skills and experience and providing contact details for interested prospective clients to get in touch with you. Ensure there are no unprofessional photos or comments on your profiles, creating separate pages for your limited company if you want to keep your personal life removed from your work, and you could see an increase in opportunities heading your way.

In fact, research from CareerBuilder published earlier this year showed that more than half (52 per cent) of UK businesses now take a look at contractors' social media profiles before hiring them.

Rosemary Haefner, chief human resources officer at CareerBuilder, commented: "Tools such as Facebook and Twitter enable employers to get a glimpse of who candidates are outside the confines or a resume or cover letter. And with more and more people using social media, it's not unusual to see the usage for recruitment grow as well."

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