Business Advice

[sambosa75]

A couple of years ago I opened a recruitment company (I say opened, I opened a Bank account under the companies name and got some letter headed paper made!) and shortly after was offered a full time job in online recruitment for a major job board. Because of this the recruitment company never really got off the ground.

 

In the last couple of days however a couple of Red hot vacancies have fallen at my lap. Both are desperate to be filled by the end of the week. I found a couple of candidates for both roles and have had 2 interviews take place already with another 2 to follow this afternoon. My "client" wants to offer a role to one of my candidates and is willing to pay me £2,500 for her services. Not bad for about an hours work on my part.

 

Does anyone with experience of providing professional services (whatever they may be) know what the procedure is with regard to invoicing? Do I have to send a professional looking invoice or can I just break down the costs on email.

 

The "client" is a very professional investment brokerage in Central London so I will imagine they will want all their paper work in order.

 

Is anyone able to advise me on how I should proceed with this?

 

Many thanks,

Sam (bosa75)

[Tokyo-Saint]

I am co-owner of a small company. I would advise making up a professional looking invoice with the heading from your headed paper. I would make it up into a PDF and send it over.

 

As the company are a big company, I would give them over the top levels of customer service, calling up to check how they are getting on etc. You never know they might come to you again and again.

[Gemmel]

As long as you dont put VAT on it, then you can send them the invoice in way form you want, though as per Tokyo Saint, it will be best to do it as professionally as possible, save it as a PDF and then run it as a sideline.

 

What Job board out of interest.

[sambosa75]

As long as you dont put VAT on it, then you can send them the invoice in way form you want, though as per Tokyo Saint, it will be best to do it as professionally as possible, save it as a PDF and then run it as a sideline.

 

What Job board out of interest.

 

I'm presuming I can find invoice outlays online somewhere... I have been sending all CVs in PDF also so saving an invoice to PDF shouldnt be a problem. You mentioned the other thing I forgot to mention... VAT. Should I not be charging VAT. As a company I am obviously not VAT registered so I'm guessing not. Will this raise any problems at the clients end?

 

Thanks.

 

Gumtree and then Total Jobs by the way.

[sambosa75]

I am co-owner of a small company. I would advise making up a professional looking invoice with the heading from your headed paper. I would make it up into a PDF and send it over.

 

As the company are a big company, I would give them over the top levels of customer service, calling up to check how they are getting on etc. You never know they might come to you again and again.

 

Thanks for this advice. Really helpful. I've replied to Gemmels post too. If you are able to advise on the VAt situation also please do. Thanks.

[saint simes]

I'm presuming I can find invoice outlays online somewhere... I have been sending all CVs in PDF also so saving an invoice to PDF shouldnt be a problem. You mentioned the other thing I forgot to mention... VAT. Should I not be charging VAT. As a company I am obviously not VAT registered so I'm guessing not. Will this raise any problems at the clients end?

 

Thanks.

 

Gumtree and then Total Jobs by the way.

 

 

If you are not VAT registered you must not charge/mention VAT on your invoice, unless you would like a visit from a nice man in a suit!

 

As you are not charging (adding) VAT your client is not paying it so has nothing to claim back = no problem. In my experience it is not usually a problem when selling a "service" but can be when selling "goods".

[saintbletch]

Does your contract of employment with the job board contain anything that might stop you from doing this?

 

If it's in a similar field I wouldn't be surprised if your employer insisted that you at least inform them of any such 'competitive' interests.

 

Have you been upfront with the investment brokerage? In that you are not a legal entity and are not VAT registered. If I understand company law correctly (and I'm no expert) you would be a sole trader operating under a trading name and would not be VAT registered. The brokerage may have company procedures that stipulate that they can't trade with someone that they can't sue so you should certainly explain the who legal entity is that they would be doing business with.

 

Their accounts team would query an invoice that doesn't have a VAT element. There's nothing wrong with an ivoice that doesn't have VAT but they would routinely expect to be dealing with companies that charge VAT. There's no need for you to be VAT registered if your turnover is less than a certain amount (I think it's about £65K). You must NOT charge VAT unless you're VAT registered (or have a desire to go to prison).

 

I'd be inclined to explain your circumstances before you send over the invoice so there are no surprises. Perhaps suggest that you're in the process of setting up the company/VAT.

 

Does the brokerage company also do business with the job board you work for? If so then I think you may be in a tricky situation.

 

They may also expect you to have published terms and conditions for the 'sale' and having used recruiters myself there are a lot of clauses to do with fees, payment schedules and especially fees under probationary periods so I would expect them to want to see those outlined. But I guess you know more about that than most.

 

Good luck.

[Window Cleaner]

Invest a little bit of your easy come money in a small business software package, there are loads of them about, Sterling used to be pretty handy, invoicing, pay, book-keeping etc.

[sambosa75]

Does your contract of employment with the job board contain anything that might stop you from doing this?

 

If it's in a similar field I wouldn't be surprised if your employer insisted that you at least inform them of any such 'competitive' interests.

 

Have you been upfront with the investment brokerage? In that you are not a legal entity and are not VAT registered. If I understand company law correctly (and I'm no expert) you would be a sole trader operating under a trading name and would not be VAT registered. The brokerage may have company procedures that stipulate that they can't trade with someone that they can't sue so you should certainly explain the who legal entity is that they would be doing business with.

 

Their accounts team would query an invoice that doesn't have a VAT element. There's nothing wrong with an ivoice that doesn't have VAT but they would routinely expect to be dealing with companies that charge VAT. There's no need for you to be VAT registered if your turnover is less than a certain amount (I think it's about £65K). You must NOT charge VAT unless you're VAT registered (or have a desire to go to prison).

 

I'd be inclined to explain your circumstances before you send over the invoice so there are no surprises. Perhaps suggest that you're in the process of setting up the company/VAT.

 

Does the brokerage company also do business with the job board you work for? If so then I think you may be in a tricky situation.

 

They may also expect you to have published terms and conditions for the 'sale' and having used recruiters myself there are a lot of clauses to do with fees, payment schedules and especially fees under probationary periods so I would expect them to want to see those outlined. But I guess you know more about that than most.

 

Good luck.

 

Thanks for your advice. Really appreciated. I am actually out of the recruitment industry altogether now (well, I was before yesterday!) and sourced my candidates perfectly legally and legitimately.

 

The reason I got this vacancy is because my girlfriends best friend is the firms Managing Director and she knows my situation. She just has an urgent need for the 2 roles in question to be filled and knew I had the skills, experience and know-how to get the positions filled quickly.

 

I remember informing the bank when setting up my account I was a sole trader so as long as thats the case and I dont charge or mention VAT on the invoice there wont be any ramifications?

 

I do have legally binding terms and conditions which I send over with every CV.

[Baj]

Fairly easy one this.

I used google apps for my invoices, basically create them it the "word" type application then save as PDF.

Chuck you company logo at the top, but your address and details at the bottom the on the invoice just make sure you put everything thats relevent, date, invoice number, job, description, cost, then just email them the PDF.

Oh little hint, when you email them make the subject of the email the invoice number and person you are invoicing, makes it a lot easy to find these details later.

[sambosa75]

Fairly easy one this.

I used google apps for my invoices, basically create them it the "word" type application then save as PDF.

Chuck you company logo at the top, but your address and details at the bottom the on the invoice just make sure you put everything thats relevent, date, invoice number, job, description, cost, then just email them the PDF.

Oh little hint, when you email them make the subject of the email the invoice number and person you are invoicing, makes it a lot easy to find these details later.

 

Much appreciated Baj. I'm assuming it's best to make up a random invoice number. I dont suppose invoice number 1 or 000001 are going to inspire much confidence in the company accountant!

[Tokyo-Saint]

No need to worry about VAT at the moment. I am not an expert asI work in student travel so mostly exempt, however I believe you can earn about £70K before you get charged yourself. If you think you are going to make more than £70K this year then you should add it to your invoice, if not then just leave it to keep things simple.

[hamster]

Newbie to this self employed thing to, after setting up a company (currently dormant/not trading as yet).

 

My understanding re company letters and invoices in particular is that you should always quite your company's registered number. Assuming of course that you have registered your company?

 

Good luck with it.

[Baj]

Much appreciated Baj. I'm assuming it's best to make up a random invoice number. I dont suppose invoice number 1 or 000001 are going to inspire much confidence in the company accountant!

 

Yeah true, just start it from 150, if you get inspection or anything, just explain that to hmrc

[Dimond Geezer]

I occasionally do work for a mate (who runs a legitimate company). I invoice him on an invoice template I concocted in Word, like you, when I started out I didn’t want a project number ‘001’, so used the year of my birth, an ran consecutive numbers from there. I put the money in an entirely separate building society account. I’m up front with HMRC (unlike our fishy friends), and every April I complete a self assessment form, once HMRC have had their pound of flesh, I take the rest from the account and usually fritter it away on whatever the Mrs decides (and my season ticket). Obviously I pay tax at the usual PAYE rate, as I’m a sole trader & have never bothered setting up a company.

[sambosa75]

I occasionally do work for a mate (who runs a legitimate company). I invoice him on an invoice template I concocted in Word, like you, when I started out I didn’t want a project number ‘001’, so used the year of my birth, an ran consecutive numbers from there. I put the money in an entirely separate building society account. I’m up front with HMRC (unlike our fishy friends), and every April I complete a self assessment form, once HMRC have had their pound of flesh, I take the rest from the account and usually fritter it away on whatever the Mrs decides (and my season ticket). Obviously I pay tax at the usual PAYE rate, as I’m a sole trader & have never bothered setting up a company.

 

I assume that means I just need to hold back 20% of whatever I earn "just in case". Is there an expiry on this? Lets say if only do these two placements for a whole year but leave my 20% there in case HMRC get in touch but they dont for a year, is that money rightfully mine or should I willfully declare it? This is probably a really stupid question. I dont want to come across as a tax dodger (as much as I'd like to be one!) just want to know what my rights/obligations are.

[Dimond Geezer]

I assume that means I just need to hold back 20% of whatever I earn "just in case". Is there an expiry on this? Lets say if only do these two placements for a whole year but leave my 20% there in case HMRC get in touch but they dont for a year, is that money rightfully mine or should I willfully declare it? This is probably a really stupid question. I dont want to come across as a tax dodger (as much as I'd like to be one!) just want to know what my rights/obligations are.

 

Yes that's basically what I do, I just choose to leave all the cash in the BS.

 

You will need to contact HMRC & let them know your situation, they will send out a SA form & collect the tax the following January, you can also ask for exemption from National Insurance (assuming you don't go above a threshold, that I can't remember atm). This is my situation anyway, not sure if it the same for a registered company.

[stevegrant]

I assume that means I just need to hold back 20% of whatever I earn "just in case".

Potentially 40% depending on how much you earn through it combined with your regular job earnings.

 

There are almost certainly tax savings to be made by channelling it through a limited company, but that's beyond the scope of my knowledge, to be honest.

[toofarnorth]

Potentially 40% depending on how much you earn through it combined with your regular job earnings.

 

There are almost certainly tax savings to be made by channelling it through a limited company, but that's beyond the scope of my knowledge, to be honest.

 

Do you have to pay national insurance?

[aintforever]

I occasionally do work for a mate (who runs a legitimate company). I invoice him on an invoice template I concocted in Word, like you, when I started out I didn’t want a project number ‘001’, so used the year of my birth, an ran consecutive numbers from there. I put the money in an entirely separate building society account. I’m up front with HMRC (unlike our fishy friends), and every April I complete a self assessment form, once HMRC have had their pound of flesh, I take the rest from the account and usually fritter it away on whatever the Mrs decides (and my season ticket). Obviously I pay tax at the usual PAYE rate, as I’m a sole trader & have never bothered setting up a company.

 

I've done work on the side for a mate who also has a legit company but I havn't informed HRMC because someone told me you have to make over £7000. I obviously have a day job earning more than that so does that mean I'm doing a "pompey"?

[benjii]

I've done work on the side for a mate who also has a legit company but I havn't informed HRMC because someone told me you have to make over £7000. I obviously have a day job earning more than that so does that mean I'm doing a "pompey"?

 

Yes, it sounds like you are evading Income Tax.

[aintforever]

Yes, it sounds like you are evading Income Tax.

 

B@ll@x.

 

Does anyone know wether my boss will find out I'm moonlighting if I inform HRMC of what I am earning on the side. If my tax band suddenly jumps up won't it be obvious?

[Dimond Geezer]

Do you have to pay national insurance?

 

You will need to pay Class 2 NI, but if your profits are less than £5075 you can apply for excemption.

 

I've done work on the side for a mate who also has a legit company but I havn't informed HRMC because someone told me you have to make over £7000. I obviously have a day job earning more than that so does that mean I'm doing a "pompey"?

 

Yes definetely, you should pay tax on all your earnings (over your threshold). I hope you haven't been defrauding charities

as well.

[sambosa75]

Jesus, got another 12 vacancies off them. Anyone fancy a job as a recruitment consultant?!

[Dimond Geezer]

B@ll@x.

 

Does anyone know wether my boss will find out I'm moonlighting if I inform HRMC of what I am earning on the side. If my tax band suddenly jumps up won't it be obvious?

 

There's no reason why your boss should find out, as you can opt to pay either through your tax coding (in which case your employer may ask a question or 2), or you can pay a lump sum (possibly in installments, I don'nt know) direct to HMRC. This option is given on your tax form. This is how I do mine, the guv'nor is completely unaware.