[andy_e]

 Hi business experts...

I'm hoping to get a few days of consultancy work here and there but I'm not sure what I need to do to have an actual consultancy business. I've heard people talk about limited liability and insurances and things like that, but I've no idea where to get started! Can anyone help me out please? Ta!

[tomtom]

Hi business experts...

I'm hoping to get a few days of consultancy work here and there but I'm not sure what I need to do to have an actual consultancy business. I've heard people talk about limited liability and insurances and things like that, but I've no idea where to get started! Can anyone help me out please? Ta!

Talk to Jasper?

[filz]

I'm not a business expert, but I'll try to give you some tips.

First things first.. In what area will you be consulting?
That will determine if you need insurances etc...

Don't know much how to things work in UK, so others will surely be more helpful    but in general, if you create a Limited company, the company finances are separate from your personal finances meaning you're responsible for eventual business debt only up to a point.

If you only will take a few days of consultancy here and there you probably don't need a limited company.
Also consultancy in general is not a risky business so it's unlikely the business will be in big debts.

Another suggestion is to setup a general consultancy agreement to submit to your customers. You can find some free templates online, but I strongly suggest you to hire a lawyer and ask her/him to revise the agreement. It will save you trouble in the future

[andy_e]

Thanks filz, some useful information in there. As it's the oil industry I'm quite wary of something on a rig going tits up and bigger companies handing down blame to smaller companies as has happened in the case of BP recently.

[rosmat]

I work as a consultant - most companies require at least that you work through a Limited Company (easy to set up) and have Professional Indemnity Insurance (google online for quotes).

[andy popp]

Falling Down set up his own consultancy firm earlier this year (having worked in big firms in the industry for a number of years). I'd imagine he would have a lot of useful knowledge.

[SA Chris]

Are you still working full time for another company? Are they aware you are doing this work on the dies and are they happy about it?

Otherwise, what rosmat says regarding LC  and PI, and even then make sure any contractual arrangements you enter into are legally OK, and you don't get screwed.

[tomtom]

Andy - have you any mates who already do this? (One man band consultency?) if this is a bit of a one off, then it might be easiest for you to use their company and they can then subcontract or employ you to do the work (for a cut) - which would mean you would be covered by their indemnity?

[andy_e]

I haven't actually got any work lined up yet, just hoping to get some and be in a position to do the work if it comes in. I'm trying to get my name out there!

I don't really have any friends that already work as independent consultants, so that's not really an option unfortunately. How much are we talking approximately for indemnity insurance? I'm worried that I'll be spending loads of money on nothing if I don't get any work in.

[Fultonius]

I used to work as a freelance engineer. I used Nasa Consulting as an Umbrella company who did my tax, NI & insurance for £15/week worked (if you don't work, you don't pay). NB: I was a PAYE "employee" for them, which is't tax efficient" and you don;t have as much scope for offsetting purchases (necessary business purchases....) against your tax bill.

I still had to work through an "Agency" as the company I worked for wouldn't hire direct. They could, in theory, have pimped me out to other clients but the way it was I only worked for the company I had previously worked for and that's why I never got round to going limited.

From what I remember indemnity insurance isn't too much and if you get even one paying job, you'll make it back no worries. You may even be able to get insurance lined up in advance but not take it out until you have a job booked, or maybe not...?!?!

I'd say get yourself a LTD company set up. Only cost £100. You'll need an accountant if you even make any money, but that's easily saved back in n Tax & NI over being a freelancer. If you buy any computer equipment, business card "work clothes" you can offset that all against tax as they are legitimate business expenses.

[andy_e]

Cheers beast, good beta. Is that £100 once or annually?

[rosmat]

I'd say get yourself a LTD company set up. Only cost £100. You'll need an accountant if you even make any money, but that's easily saved back in n Tax & NI over being a freelancer. If you buy any computer equipment, business card "work clothes" you can offset that all against tax as they are legitimate business expenses.

This. Works a treat for me.

£100 setup cost is a one off.

Personal Indemnity can be bought for about £150 last time I checked for cover of £2m (depending on industry).

If you use Free Agent software you could consider doing you're own accounts (*I don't do this - having an accountant is work the £75 quid a month to me).

[Johnny Brown]

In my experience insurance premiums are linked to turnover. Using Kashflow or similar will make your invoices look professional, keep track of payments and do 99% of your accounts for £5/month.

[andy_e]

Thanks, plenty of useful info so far! In order to look slightly more professional, I need a website and email address but don't want to spend too much. Anybody got any tips please?

[Fultonius]

Have you got a company name in mind?  You can check here to see if it's available, or if there are other companies with very similar names.

https://beta.companieshouse.gov.uk/

[andy_e]

Yep. As suspected, the name doesn't exist...

[Fultonius]

I'm not sure if you're implying that's a good thing or not...but it it is!  Better to have something unique.

[filz]

In order to look slightly more professional, I need a website and email address but don't want to spend too much.

For the website, if you want to do it on your own, I suggest using:
http://wordpress.com

You can start for free creating a website with a name like http://andy_e.wordpress.com and later for a few bucks you can buy a domain name with the name of the company.

For the email use Google Apps ( http://apps.google.com ) it's gmail used with your domain name. The cost is €4/month.

[Jaspersharpe]

You don't need to spend £100 setting up a company. Just do it through Companies House website and it costs about £15.

[Fultonius]

You don't need to spend £100 setting up a company. Just do it through Companies House website and it costs about £15.

#

My bad    I thought it was £100, not £15.

[andy_e]

Do I need a separate bank account for my business if I set up a limited company? As you can tell I'm a complete beginner when it comes to the word of business... Thanks for your patience!

[Plattsy]

Yep.
Think you can get them fee free for a year. IIRC I set mine up with my existing personal bank over the phone.

[andy_e]

Ta!

[petejh]

Are you thinking about registering for VAT? If so the Flat Rate Scheme and Annual Accounting works well for consultancy work. Means you charge the client 20% VAT and pay back 14% on total turnover (including VAT charged). Works out you gain a couple of percent per year, but can't claim back VAT on purchases.
Annual Accounting means you send one VAT retrun per year and make quarterly payments on account.