A Checklist for 2021 | Contracting | Icon Accounting

 Whatever it is that you are trying to achieve this year, we want it to become a reality, but we also want 2021 the best year of Contracting that you have ever experienced so we have compiled a checklist for all of our clients to consider.

January is the beginning of the calendar year and often the month of trying to better yourself whether that be a new year’s resolution, a change to your diet or even becoming more active.
 

Whatever it is that you are trying to achieve this year, we want it to become a reality, but we also want 2021 the best year of Contracting that you have ever experienced so we have compiled a checklist for all of our clients to consider.

• Have a Financial Review

If you want to discuss your current financial position with an expert, as part of the Icon Accounting service, you gain access to a wealth management partner and they offer a financial review free of charge for all Icon Accounting clients. If you have not taken advantage of this yet, you really could be missing out on substantial tax savings.

• Set your goals for 2021.

Despite the fact that we are currently in a pandemic, we can still set goals that we are striving to achieve. Having a goal in sight is a big positive to your mental health and helps to keep you focussed, even during the worst of times.
It does not matter how big or small your goal is, we are here to help you to achieve it!
If your goal is related to your career or contract, you should share your plan with your dedicated account manager to make sure they are aware of what you are trying to achieve so they can assist and make suggestions for you to consider. We have helped thousands of contractors to achieve their goals, let us help you.
If your goal is to become healthier, check out your bespoke Wellness programme in iPerks, designed specifically for you.

• Prioritise your Wellness!

Whether it be physical or mental or preferably both, it has never been as important to prioritise your wellness. Socially, there are many restrictions in place that have been challenging for many, but there are numerous other avenues to explore that can be hugely beneficial to your wellbeing.
Yoga, meditation, and general exercise classes can be found within iPerks, or even on YouTube!

On top of the physical aspect to wellbeing, it is equally as important to look after your mental health during these times – staying in touch with people, reflecting in a journal and setting goals are all significant mood improvers.

Despite the fact that we are currently going through some difficult times, they will not last, it is imperative that you do!

• Choose a new skill to master!

Up-skilling as an Independent Professional has always been recommended to those who wish to contract long-term.
iPerks now gives all of our clients access to over 4,000 courses – over 90% of these courses are completely free to attend until certification which can incur a once-off cost.
 

Whatever subject you decide to learn about, whether that is expanding your understanding of an area that is close to your contract role, or it could be learning how to cook, whatever it is, smash it out of the park, it will be nice to have a few positives to take from these difficult times.

• Stay in touch!

Not only with your friends and family but with your colleagues, your dedicated account manager, recruiters, and the market itself.
You do not have to spend hours on the phone every single day to stay in touch with people, utilize LinkedIn to stay connected with recruiters on upcoming opportunities and stay in touch with the market to analyse your opportunities.

Staying in touch can be the difference in finding a new opportunity before you need to and not finding an opportunity at all. The goal is to have your network contribute to your net worth.

If you would like us to organise your financial review, help in setting your goals or if you would like to hear more about iPerks, get in touch by emailing sean@iconaccounting.ie, we’ll be delighted to help in any way that we can.

If you are lacking somewhere to manage your firm or a business you can consult with Accounting services in Ireland i.e. Icon Accounting. We have the best accountants and it is the leading Accountancy services in Dublin.

How to Succeed as an Independent Professional – Tips and Hints directly from Contractors

With the market currently booming and many first-time contractors making the switch from ‘permanent employment’, we asked some of our most experienced contractors for some of their tips and tricks for success whilst working as a Contractor.

Working as an independent professional can often seem like it is more complicated than it actually transcends to be.

With the market currently booming and many first-time contractors making the switch from ‘permanent employment’, we asked some of our most experienced contractors for some of their tips and tricks for success whilst working as a Contractor. We have compiled their answers to give new independent professionals some tried and tested advice, directly from the experts themselves.

For context, we have provided a brief introduction to our experts, Tuhin, Dusan and Stephen.
With a combined 30 years of independent professional experience, we are extremely grateful that they took the time out to answer our questions.

Tuhin:

After stumbling into the market through a contract opportunity back home in Dublin whilst working abroad, Tuhin worked as an independent professional for over 7 years.

Despite not knowing much about contracting, Tuhin was eager to return to Dublin where his family were residing. Shortly afterwards, Tuhin became an Icon Accounting client and managed Programs and Portfolios of a cumulative value of over €350 million during his career.

Tuhin is widely recognized as a trusted adviser to multiple Bank’s senior management teams having a wealth of experience across the globe in the areas of both business process management and IT change.

Dusan:

The opportunity to work on exciting projects and multiple different opportunities is what attracted Dusan to contracting initially. 8 years’ later and Dusan has built a huge reputation in the sector and is still contracting successfully today. With experience in Linux, Open Source, Cloud (Amazon AWS, OpenStack), Agile Software Development, Devops and Automation (Puppet, Ansible, CFN, Heat), Dusan has seen it all.

Stephen:

Stephen started out working as a Programmer in the Software industry in Ireland in 2000, developing web applications across many different companies and industries.
With over 14 years of Contracting experience – primarily in Java development, Stephen used contract opportunities to stay doing what he loved, despite his client’s best efforts to get him into a management role.

What are the biggest benefits to working as independent professional in your opinion?

T: Flexible hours was a huge benefit; I did not have to worry about booking time off to attend family events and instead could work around a schedule that suited me. This helped to improve my work-life balance and I would say that was another benefit, an improved work life balance. Finally, the ability to remove yourself from the office politics. When working as an independent professional, you can go in, do your work, and really leave everything behind you at the end of the day, as long as you do a good job!

D: The opportunity to work on many exciting and different projects as well as constantly learning from the new people that you meet on different projects were two huge benefits. The other huge benefit of Contracting for me was the improved work-life balance that comes with the added flexibility, which allowed me to up-skill whilst contracting.

S: The biggest benefit for me initially was the higher rate of pay, I was working alongside some independent professionals whilst working in full-time employment and they were getting paid more than I was for doing the same work, so I quickly fixed that.
This accompanied with fulfilling a long-term desire to become self-employed and again, the improved work-life balance allowed me to complete projects whilst also spending as much time with my family as possible.
I can also work on another project that I own called the Mindful Living Guide which was not possible, when working as an employee as I was very restricted with my time.

What advice would you give to a first-time Contractor?

T: Build relationships with recruiters and your managers, you never know when you will be looking for your next opportunity and keeping in touch with hiring managers and contract recruiters gives you a better chance than not keeping in touch. Even if you are not interested in your next contract just yet, keep in touch with the market, the rates and know what is happening out there.
Another tip I would give is to make the most of the increased income, you do not have to pay it all to yourself, save for a rainy-day or month where you do not have a contract.
Paying yourself less can often result in paying yourself more.

D: Prioritise relationships and liaise with colleagues as much as you can. Your network is everything as an independent professional and there is always something to learn from colleagues and managers that you are working with. It is very easy to go in, do your work and leave but establishing connections will be the difference in more contracts coming your way.
Up-skilling and cross-skilling are also very important to anyone who wants to work as an independent professional.

S: Be as adaptable as you can be, you may be starting a new contract role and come across some new technology that you have not encountered before, it is all about having a willingness to learn and to be adaptable to change. It is also paramount to build a relationship with the hiring client, I have had a six-month contract extended to a period of over 3 years, solely because the management liked working with me. If longevity is the goal, make the effort. I have worked with some contractors who were not always good to work with and you simply will not get extensions if people don’t enjoy working with you.
 

If you were starting again now, would you do anything differently and if so, why?

T: Put your hand up early if you do not understand how something works, the team at Icon Accounting and even Rockwell Financial are there to help you and support you. If I were starting out again, I would be wiser with my increased rate of pay.
Put a plan in place with your account manager or financial advisor and make the most of it from the outset.

D: Spend more time prioritising relationships. Upskilling is important but your network is as important.

S: I would have more confidence with recruiters, I have come across some great recruiters but also some not so great. You can be knocked back at times, but you have to trust them to sell you to their end term client.

Know the market and ask for your worth, hold all of the cards when you enter negotiations.
Never discount relationships with fellow contractors and colleagues, they can often introduce you to new projects and recommend you to the employer directly which is priceless.

If you are an independent professional and you have any other tips and hints that you feel would be beneficial for first-time contractors, please get in touch.

Likewise, if you are new to Contracting and would like any questions answered by experienced independent professionals, we would love to hear from you, please get in touch by emailing info@iconaccounting.ie 

Role Of Financial Accounting In Decision Making Process

 

While it might sound exhausting or obscure, Financial Accounting or Bookkeeping playing a key role that permits organizations to monitor all their monetary exchanges. It is the cycle where organizations record and report the bits of financial information that go all through their business activities that permit both organization managers and outside investors and analysts to comprehend the organization's wellbeing and settle on informed choices.

Guidelines and Best Practices

 

There are a series of bookkeeping rules that organizations should stick to in their Financial Accounting. Most traded on open market organizations in the United States follow the proper accounting rules (GAAP), a typical arrangement of principles and best practices that bookkeepers follow when they do the math and complete monetary statements.

Organizations outside the U.S. for the most part adhere to other worldwide principles that change by area and nation. In any case, paying little mind to which set of guidelines is followed. there are three fundamental zones where Financial Accounting assists with dynamic:

 

1.      It gives investors a benchmark of examination for—and the correlation between—the financial health of securities-issuing enterprises.

 

2.      It assists creditors to assess with evaluating the dissolvability, liquidity, and financial soundness of organizations.

 

3.      Alongside its cousin, managerial accounting, it assists organizations with settling on choices about how to dispense scant assets.

 

Investing Decisions

 

Fundamental Analysis relies vigorously upon the Accounting data that is recorded on an organization's fiscal reports, including the balance sheets , income statements, and cash flow statements. Every one of the budget summaries for traded on open market organizations are made and answered by the monetary accounting norms set out by the Financial Accounting Standard Board (FASB) and submitted to the Securities and Exchange Commission.

 

Investors and investigators utilize the data from financial statements to settle on choices about the valuation and reliability of an organization, permitting them to set value targets and decide whether a stock's cost is genuinely esteemed or not. Without the data gave by financial accounting, investors would have less understanding about the chronicled, current, and forthcoming monetary strength of stock and bond backers. The prerequisites set out by the FASB make consistency in the circumstance and style of monetary records, which implies speculators are less inclined to be liable to bookkeeping data that has been separated dependent on an association's current condition.

 

 

 

 

Loaning Decisions

 

Financial Accounting by Accountants in Ireland is likewise a key for loan bosses, from banks to bondholders. Since financial statements outline each one of its resources just as the short-and long haul obligation, banks improve the feeling of an organization's creditworthiness. 

 

Various normal accounting ratios lenders depend on, for example, the debt-to-equity ratio (D/E) and times interest earned ratio are gotten totally from an organization's budget reports. In any event, for exclusive organizations that don't follow the necessities of the FASB, no loaning foundation expects the risk of enormous business credit without basic data gave by monetary bookkeeping procedures.

 

At last, a loan specialist truly needs to realize exactly how much danger is included when lending company money, which can be dictated by auditing the organization's financial accounting. When this degree of danger is resolved, the bank will likewise have the option to plot precisely the amount to loan and at what interest rates through the cycle of Underwriting the loan.

 

Corporate Governance

 

Reliable Accounting like Accountancy services in Ireland serves a reasonable capacity for outside investors and moneylenders as well as for the inside functions of the organizations themselves. 

 

The most evident advantage for organizations to allude to their financial accounting is to meet the lawful and administrative commitments delineated for (public) firms. Organizations should be straightforward and straightforward about their monetary exercises and the data reported should be precise and routinely refreshed.

Beyond the administrative and consistence obstacles financial accounting also assists organizations with streamlining their everyday tasks and distinguish the sorts of undertakings that could give development openings later on. financial accounting assists managers with making spending plans, comprehend public insight, track proficiency, investigate product performance, and grow short-and long term techniques, among a few different choices helped by accounting figures.

 

The Bottom Line

 

financial accounting is a route for organizations to monitor their activities, yet in addition to giving a depiction of their monetary wellbeing. By giving information through an assortment of explanations including the financial statements and balance sheets, an organization can give investors and moneylenders more influence in their dynamic.

 

KEY TAKEAWAYS

 

Financial Accounting includes recording, summing up, and reporting the surge of exchanges and financial action coming about because of business tasks throughout some period.

Administered by a standard arrangement of practices, Financial Accounting's final result is a bunch of true organization budget reports including the balance sheet and income statement.

 

These budget reports are then utilized by organization directors, Contractors, financial specialists, analysts, banks, and different partners to settle on educated choices.

 

Contractor Mortgages with Robert Whelan

 

#AskTheExpert Series: Contractor Mortgages with Robert Whelan BComm, QFA, Rockwell Financial Management. COVID has brought with it many challenges.

With work now untethered from place, and with family ties brought into sharper focus, you may well be considering your plans for a move, and therefore a mortgage.  First time Contractors often fear that taking a contract role means giving up the chance to obtain a mortgage.

Thankfully, that is just not true. In fact, you may be in a position to borrow more as a Professional Contractor, as your income is likely to be greater than that of a permanent employee.

As part of our recent #AskTheExpert series, Robert Whelan BComm, QFA of Rockwell Financial Management outlined universal criteria for obtaining a mortgage and the most common Contractor questions on mortgages.

Read on for a synopsis of what was discussed, as well as a look at how Icon Accounting can help you on your mortgage journey.

Universal Criteria for Getting a Mortgage

The standard benchmarks for permanent employees also apply to Contractors:

- Deposit

- Loan to Income

- Repayment Capacity – Everyone is familiar with the struggle of saving for a deposit, but did you know that your behaviour over the past six months can make or break your mortgage application? Demonstrate that you can meet the mortgage repayment you are likely to have by showing evidence of your ability to pay rent/save to the same amount.

- Credit History – Access a forensic analysis of your own credit history, otherwise known as a Consumer Credit Report here.

Did you know that 10% of all mortgage applications can get an exception to rules such as loan to income, deposit, or net disposable income (mortgage repayments cannot exceed a percentage of your net disposable income – typically 40-45%).

When starting your mortgage journey, be aware of the Central Bank rules on mortgages, and if you are looking for an exception, be exceptional.

For example, if your bank has requested proof of repayment capacity and you wish to be granted an exception on your loan to income, show a larger repayment capacity than asked.

Click here to read Robert’s Top Tips for Contractor Mortgages (the do’s and don’ts to be aware of).

Most Common Contractor Questions on Mortgages

- How long do I need to be contracting before I can apply for a mortgage?

Typically, contractors could apply for a mortgage after 12 months in contract, which would demonstrate a continuity of career. However, post-Covid, the banks may be more reticent to consider an application of under two years. This is sector dependent.

- Will I need a bigger deposit as a contractor/Will I be considered higher risk?

No, certainly not.

- What happens if I leave contracting/How long do I have to wait to apply?

Typically, I would advise ex-contractors to wait until they have been in a PAYE/Permanent position for six months.

- What’s changed post-Covid?

Post-Covid, we have seen turnaround times slow somewhat. We have also noticed a greater scrutiny placed on the sector that a contractor is operating within.

How Icon Accounting can help you on your Mortgage Journey

If you are an Icon client who is applying for a mortgage, we can provide the following

- Certificates of Salary

- Three to six-month payslips

- Letter confirming that taxes are up to date

- Tax Clearance Cert

- Copy of previous three years of tax returns

- Financial statements for your limited/umbrella company

- Bank statements for your limited company

If you have any questions about Contracting, the advisory team would be glad to field your questions. You can get in touch here.

If you are already an Icon client, and have any questions on mortgages, reach out to your Account Manager. If you would like to speak directly to a Mortgage expert, contact 01 2966120 or visit www.rockwellfinancial.ie

If you have any queries when ordering your Taxsaver ticket, don’t hesitate to contact us at taxsaver@iconaccounting.ie and one of our members will be in touch in no time.

Stay tuned for new updates and we will back with all new features again shortly. Icon Accounting the best Accountancy services in Dublin, Ireland.

Contractors: 10 Important Tax Saving Tips

 If you are an independent contractor operating in Ireland, you’ll need to declare your income to the Revenue Commissioners and pay tax through the self-assessment tax system.

However, a combination of effective planning and ensuring you avail of all applicable tax reliefs can impact your tax bill. You need to assess your tax saving opportunities in order to maximise your tax credits and increase saving. Ask yourself – what taxes can my business claim?

While we at Icon Accounting are always on hand to help you with your accounting needs, below are some of the most effective tax saving tips that could help reduce your tax liability.

Claim for ‘Allowable Deductions’

Contractors are entitled to claim legitimate business costs as expenses, which can be offset against income. Any expenses are deducted from your profits, so the higher your expenses, the lower your taxable profits. There are many common contractor or freelancer expenses you may be able to claim for, such as: phone bills, motor expenses, insurance costs and materials.

Avoid Penalties

Avoid penalties for the late submission of your tax return. As an independent contractor, tax must be paid on or before the annual tax deadline, based on the income you earned in the previous year. If you don’t pay your tax bill on time, you could be liable for a penalty, which can rise if your payment continues to be late.

        – When is the income tax return deadline 2020?

          The income tax return (AKA Form 11) deadline for 2019’s income is the 31st of October 2020. If you file and

          pay your taxes online, the deadline is Thursday 12th of November 2020.

        – When is the companies office return deadline 2020?

          Depending on ARD Date (initial €100 plus €3 per each day for late submissions).

          Also late accounts require an Audit – Increasing Professional fees.

        – When is VAT returns deadline?

          VAT returns are due 23rd of Month following period end (Bi monthly, Quarterly, 6 monthly or annually)

Claim Medical Expenses

If you pay medical expenses that are not covered by the State or by your medical insurance provider, you can still claim tax relief on those expenses. You will receive tax relief for health expenses at the standard rate of 20%.

Maximise Tax Credits

There may be various tax credits that apply to you, so be sure to review and apply for them where appropriate.

You may be able to:

        – Transfer any unused tax credits from your spouse across to you or apply for joint assessed tax.

        – Ensure you are getting the SPCCC tax credit if you are a single parent.

Claim Assets

Assets including a car, computers, office furniture or any plant and machinery that are required in the course of running your business – can be claimed over a period of 8 years.

Apply for Earned Income Credit

As a self-employed person, you can claim the Earned Income Tax Credit of €1,350 or 20% of your qualifying earned income, whichever is the lower. Be aware, however, that Earned Income Tax Credit can only be applied to trading income and is not available against investment or rental income.

Add Family Members to the Payroll

Wages paid for work done by family members is an expense of the business and its tax deductibility must be considered like any other expense. A family member can be employed for administration or record keeping. This is not considered technical work – if they are being employed for technical work, they should have the skills, qualifications and experience necessary to carry out that work and to justify the rate of pay.

Use the ‘Small Benefit Scheme’

The Small Benefit Scheme allows employers to provide a tax-exempt benefit to Irish employees of up to €500 per employee, per year. This is a totally tax-free gift but must be awarded in the form of a benefits voucher and cannot be paid in cash.

Expense Travel and Subsistence

Travel is an allowable expense when the journey is necessarily incurred in the performance of the duties of the office or employment. Examples of allowable travel are travel to continued professional development courses, travel from place of work to clients’ premises, travel for meetings etc.

Subsistence allowances can be utilised on the same basis – i.e. If the time spent away from the normal place of work is over a certain number of hours/days then specific subsistence rates apply.

Pay into a Pension

Pensions are one of the most tax efficient investments you can make. Any premiums paid by a self-employed person are allowed for tax relief for up to 40%.

Pay into an Income Protection Policy

Like pensions, income protection policies are very tax efficient.  Income protection policy payments allow self-employed persons to claim tax relief for up to 40%.  Income protection is also commonly known as Permanent Health Insurance.

Beware of Professional Services Surcharge

You might think that you can leave the profits in your company and only pay 12.5% corporation tax, rather than taking the money out as salary at up to 52%.

However, this surcharge counters this method of tax avoidance by imposing a surcharge of 15 per cent on 50 per cent of the company’s undistributed professional and service income.

When you eventually liquidate the company you will pay an additional 33% (at current tax rates) – Your effective rate being 46%. You need to consider which is better for you – to have the cash personally now or leave the cash in the company for a number of years saving 6% (at current tax rates).

Get Professional Support

Enlisting the help of a tax specialist, such as Icon Accounting will make sure that you are not only maximising your tax opportunities but by keeping track of the various expenses or tax reliefs that you can claim. We will calculate your income tax accurately, so you don’t run the risk of over- or under-paying and will file the tax return on your behalf and on-time.

Stay tuned for new updates and we will back with all new features again shortly. Icon Accounting the best Accountancy services in Dublin.