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Moving to the UK - how to set up?
Thread poster: Ivana Friis Wilson
Ivana Friis Wilson  Identity Verified
United Kingdom
Local time: 13:22
Member (2008)
English to Danish
+ ...
Apr 11, 2008

Hi,

In a few months I am moving to the UK and I will continue to freelance.

I'm in Denmark at the moment and I've set up a company (enkeltmandsvirksomhed, guess it is similar til sole proprietor) to get a VAT (moms) no. It was difficult enough getting all the details in order,so I thought I would ask for some advice on how to do it in the UK.

What type of company should I set up? (sole proprietor, Ltd or?) Should I even set up a company?

What type of insurance makes sense? At the moment I have unemployment insurance (not that it is any good as I have to close down my company to be eligible), but I am also thinking that I should have an insurance against illness (long term, like if I break a leg or similar).

Do I need an accountant? I am doing my VAT returns and annual reports myself at the moment, not that I like it nor am I any good at it, but it's quite expensive over here to have it done.

Any other advice?


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simona dachille  Identity Verified
United Kingdom
Local time: 13:22
Italian to English
self-employed business Apr 11, 2008

Just register as self-employed. You can then earn up to 57,000 pounds before you need to consider getting a vat number. You don't really need an accountant. I'm sure you can do all your own tax returns and it's straightforward. Look on the government website under self-employment, you will find all the info you need. Accountants are expensive here too. Last year, I just needed a letter and it cost me 250 pounds.

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Williamson  Identity Verified
United Kingdom
Local time: 13:22
Flemish to English
+ ...
Vat-treshold Apr 11, 2008

For 2008: it is £ 64000

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Peter Linton  Identity Verified
Local time: 13:22
Member (2002)
Swedish to English
+ ...
More advice Apr 11, 2008

I agree with simona dachille. A few years ago, there were tax advantages in having a company but no longer. Much simpler to be self-employed.

There is little point either in registering for VAT. That involves a lot for administration and monthly returns, and the only real advantage is not paying VAT when buying new computer equipment.

Registering as self-employed is quick and easy - just a telephone call. They will give you a reference number, and it is a good idea to quote this on invoices , and to mention that you are not registered for VAT -- otherwise customers may wonder whether to add VAT.

As for accountants, you might find it a good idea to use an accountant for your first return, and then to use that as a model subsequent years. You can buy computer software that helps you prepare your return with comprehensive information about what expenses you can claim. I use a product called TaxCalc. It guides me through the various sections, and then sends the return electronically.

You might also consider opening a UK bank account in euro. Low cost transfers, no exchange rate losses, convenient for euro customers.

Lastly, a plug for the Institute of Transition and Interpreting in the UK, which runs training courses on many topics, including tax and running a translation business in the UK. They can also advise about insurance.


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Ivana Friis Wilson  Identity Verified
United Kingdom
Local time: 13:22
Member (2008)
English to Danish
+ ...
TOPIC STARTER
Thanks for your input Apr 11, 2008

- it's a great help! Such a relief I don't have to set up a company. There's enough hassle involved in moving country.

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Giovanni Guarnieri MITI, MIL  Identity Verified
United Kingdom
Local time: 13:22
Member (2004)
English to Italian
Ltd. Apr 11, 2008

Peter Linton wrote:

I agree with simona dachille. A few years ago, there were tax advantages in having a company but no longer. Much simpler to be self-employed.



mmmm... I'm saving a lot of money by being a limited company. True, it's not as advantageous as in the past, but it's still worth it, especially if you have a good accountant...

Giovanni


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Claire Cox
United Kingdom
Local time: 13:22
French to English
+ ...
Euro bank account? Apr 11, 2008

Peter Linton wrote:

You might also consider opening a UK bank account in euro. Low cost transfers, no exchange rate losses, convenient for euro customers.



Presumably Ivana could keep her Danish bank account for incoming euro payments? Just out of interest, though, Peter, do you recommend any UK bank accounts for UK residents to set up a euro account with? When I've investigated this in the past, it seemed that you had to be prepared to keep a lot of money in the account (£5000!), which I wasn't prepared to do. However, it would certainly be a good idea to have a euro account if the situation has changed. If anyone has any recommendations, I'd be glad to hear them.


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Daniel Bird  Identity Verified
United Kingdom
Local time: 13:22
German to English
Incoming Euro payments Apr 11, 2008

Drifting a bit around the topic, but prompted by comments above, my bank (highly visible on all Hiigh Streets, Spanish-owned, former "habitual" building society) receives Euro transfers for no fee to my Sterling account. There's a fee to cash a cheque but transfers don't attract a charge.

At the moment of course it's very handy to have Euros paid into a Sterling account - it's like being paid a bonus on every job. Keep your overseas Euro a/c and you can always be paid by that channel when the exchange rate changes in the other direction.

Good luck with the move
DB


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Claire Cox
United Kingdom
Local time: 13:22
French to English
+ ...
Banking Apr 11, 2008

Daniel Bird wrote:

Drifting a bit around the topic, but prompted by comments above, my bank (highly visible on all Hiigh Streets, Spanish-owned, former "habitual" building society) receives Euro transfers for no fee to my Sterling account. There's a fee to cash a cheque but transfers don't attract a charge.

DB


Hmm, if you're talking about the bank I think you're talking about, Daniel - A....y? - I was told that there would be no fee for Euro transfers with them a few years ago. I duly set up an account and ended up being charged £21 for one incoming transfer (can't remember how much it was for, but it wasn't that much!). When I remonstrated with them they said that they didn't make a charge, but the clearing bank they had to use did and they had no control over that. It's made me somewhat wary.... Needless to say I closed the account and refuse to have anything more to do with them! At least with my bank, Natwest, I know there's a fixed charge of £7 for amounts over £100 and £1 for less than £100. However, it would be nice to set up a euro account too so that we don't lose out on the exchange rate when changing money back into euros.


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Lawyer-Linguist  Identity Verified
Portugal
Local time: 13:22
Dutch to English
+ ...
Companies Apr 11, 2008

If your turnover doesn't exceed £90,000, there's hardly any tangible benefit in setting up a company.

I know because I was due to move to the UK earlier this year, and did extensive number crunching with a very good accountant.

As Williamson says, the VAT threshold is now £64,000.

Plans changed - for reasons unrelated to the UK tax system, or setting up business there, which compares favourably with many other EU countries - and so I'll just continue to travel for work/studies, but I think you'll find Inland Revenue very approachable.

First consultations with accountants are usually free of charge, so it's best to make use of that and find someone you're comfortable with and who is familiar with translation or similar industries. Let them show you the pros and cons of setting up a company.

Best of luck
Debs

[Edited at 2008-04-11 12:41]


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xxxJPW  Identity Verified
Local time: 13:22
Spanish to English
+ ...
Euro payments... Apr 11, 2008

I receive euro payments into my (sterling) account at no charge whatsoever...It is a northern Irish bank but owned by one of the Scottish banks ultimately: I don't know how banks in Eng & Wales can get away with charging for this service....?

And all the local shops in my (fairly small) town also take euros and have done for some time now; their tills are set up for both currencies - they're glad to take anything in this current climate Although to be fair we do have a (short) tourist season here and get many diverse nationalities passing through.

It's only a matter of time before the UK switches to the euro anyway...or is that still too controversial a subject to bring up 'across the water'?

Personally I would not set up a company - although it's pretty easy to do, I've done it for friends and such - because I don't think it's worth the trouble really. Plus I'm too lazy. But I certainly wouldn't pay someone to do it for me - I get a great kick out of doing things for myself; if you want it done well, do it yourself. Or perhaps that should be: if you do it yourself and it mess it up, at least you know who to blame....

Good luck with the transition though)


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Ivana Friis Wilson  Identity Verified
United Kingdom
Local time: 13:22
Member (2008)
English to Danish
+ ...
TOPIC STARTER
Is equipment tax free? Apr 11, 2008

If you are self-employed in the uk, is equipment (software, computer etc) tax free then? Or is that only if you register as a company?

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Anita Cassidy  Identity Verified
United Kingdom
Member (2005)
English to German
not tax free Apr 11, 2008

Ivana Friis Wilson wrote:

If you are self-employed in the uk, is equipment (software, computer etc) tax free then? Or is that only if you register as a company?


It's not tax free, but if you are registered for VAT, you can offset the VAT you paid against the VAT you charged to your clients when you do your quarterly VAT returns.
Anita


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Ivana Friis Wilson  Identity Verified
United Kingdom
Local time: 13:22
Member (2008)
English to Danish
+ ...
TOPIC STARTER
So if you are self-employed and not vat-reg... Apr 11, 2008

Thanks, what I meant was, is equipment tax free if I choose not to be vat-registered?

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Anita Cassidy  Identity Verified
United Kingdom
Member (2005)
English to German
no Apr 11, 2008

Ivana Friis Wilson wrote:

Thanks, what I meant was, is equipment tax free if I choose not to be vat-registered?


No, then you pay VAT at the normal rate and have no possibility of claiming any of it back.
Anita


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