bookkeeping for contractors

Great expertise in tax efficiency, as well as business, grow and development services. We have already recommended your services and will share our good experience bookkeeping for startups with others in future. It is always someone available on the phone but if not available at the time your accountant will always call you back.

bookkeeping for contractors

They may want to seek advice from a tax professional if they have any questions or concerns. In addition, we offer IR35 support and guidance to help you determine your IR35 status and ensure that you’re meeting the requirements of HMRC. We also offer wealth management services, including pension and insurance advice, to help you plan for the future. We have been using Pearl Accountants for over 10 years and developed a very good business relationship. Very clear instructions with easy to follow accountancy system in place.

Know precisely which records to keep

Early in your contracting career, it’s easy to assume it won’t happen to you, but the longer you keep going, the more likely it is. And at that point, if your books aren’t in order, the process will become much more arduous. So keep your records as though you are preparing them to show to a tax inspector – and hold onto the paperwork for six years afterwards.

bookkeeping for contractors

Is the challenge of sorting your construction accounting holding your back? This free guide will help to simplify things so you can stay on top of managing your business admin. This is a form of accounting that uses the construction contract as the basis of the accounting – which is to say, revenues are projected based on the likely costs. Firms are increasingly being hit by legislative accounting requirements, which not only impacts construction accounting but effectively defines how it’s done. Whether you’re looking to learn about architect accounting or accounting for builders, this blog serves as a construction company accounting guide.

Do I need a professional to do construction accounting or can I do it DIY?

However, if you are outside IR35 and receive dividends from your company, you will need to complete a Self-Assessment Tax Return to declare these dividends and pay any applicable tax. Crunch has partnered with Kingsbridge, a leading provider of contractor insurance, to offer tailored packages for contractors. Even if you already have some cover in place, you may want to see if the 10% discount available to Crunch clients or Crunch Chorus members could save you money on your premium.

It’s important for contractors to be aware of their IR35 status and to ensure that their contracts and working arrangements align with their IR35 status. If a contractor disagrees with the IR35 determination made by the client or fee payer, they may need to take steps to challenge the determination and provide evidence to support their case. If you are inside IR35, your limited company must pay the appropriate employment taxes and you will not be required to complete a Self-Assessment Tax Return.

No more money nightmares

So compared with a conventional business, this is much more fluid and changeable. The impulse to handle your accounts on an ad-hoc basis might be a short-term time saver. The age of your accounts receivable, therefore, has become an important measuring stick for executives and other reviewers of financial statements. Higher ratios indicate the company is being financed by creditors rather than from its own financial sources, which could send up a few red flags. The debt-to-equity ratio is used as a standard for judging a company’s financial standing and its ability to repay its obligations. Here are the four most useful indicators you’ll find in a final account in construction.

  • We ensure your accounting system and accounting software are effective and efficient.
  • The IR35 rules determine whether the individual is an employee or self-employed for tax purposes, and if they are considered an employee, their intermediary must pay the appropriate employment taxes.
  • From sole traders to businesses with multi-million-pound turnovers, we provide outsourced accounts services to construction clients of all sizes across the UK.
  • Your own team of Crunch client managers will be on hand for day-to-day contact.

As our easy-to-use service is built around you, it makes it quick to log in and undertake tasks. Crunch helps contractors with IR35, tax responsibilities, expenses and so much more. Most modern bookkeeping software is cloud-based and will work on Mac or PC, but make sure you know what security measures are in place that not only backs up your data but keeps it safe. Empowered by Cloud specialises in construction bookkeeping and construction accounting. Single-entry bookkeeping is more suited to businesses that have minimal transactions or straightforward finances. Not only does it allow you to record and reconcile day-to-day transactions, but it also allows you to send quotes and invoices from the system and manage your VAT and CIS returns digitally.

Free Support

As you progress, you’ll find that you want to understand your finances more, and it can pay to use an accountancy software package. As a contractor, you should operate with the mindset that you are running a business where your skills are the service and product. Your professional skills are obviously impeccable – but too many contractors focus too little on the ‘running a business’ part. Every project has lots of moving parts and the end date is flexible.

bookkeeping for contractors

Contractors‘ accounting software may simplify life if you own a business. Accounting software is essential even if you operate alone and don’t have any staff to pay. GnuCash accounting software for contractors is a healthy option if you search for free desktop accounting software for your small business. To acquire this free accounting software, you can go to the GnuCash website and check it.

This enables you to raise your own invoices, automatically chase debtors and keep your own bookkeeping up to date. All of our accountants are highly qualified and trained or working towards a professional qualification. You can meet our team to learn more about our accounting experience and how we can help you run your business smoothly. Building and construction is a notoriously unpredictable industry and so having the right professional construction accountants to guide you is key.

Although it is possible to keep paper-based records or use a basic spreadsheet to record transactions, there are so many benefits to using cloud-based construction accounting software. We are pleased to say that a large proportion of our contractor clients have been recommended to us by bank managers, solicitors and other business contacts. Many have come to us because they realise that they are spending too much time looking after their financial records, and that they are not bookkeeping experts. Other clients switch to us from their current bookkeepers because they either know, or feel, that they are not getting the service, or level of expertise, they deserve. If you really struggle with bookkeeping, it might be worth your while to invest in the services of an accountant.