Taxlab provides fixed-fee accountancy for contractors, freelancers, consultants and locums working through their own limited company. We look after your accounts, tax returns, payroll and VAT, help you deal with IR35, and make sure you take your income in the most tax-efficient way. You always deal with a qualified accountant who understands how contracting works.
Who we help
- IT, software and digital contractors
- engineers, project managers and consultants
- oil, gas and energy sector contractors
- locums and healthcare professionals
- freelancers moving from sole trader to limited company
What our fixed-fee contractor package includes
- your own dedicated qualified accountant, with direct phone and email
- unlimited telephone and email support
- free company formation at Companies House
- cloud bookkeeping software at a discounted price: Xero, FreeAgent or QuickBooks. We are a Xero Silver Partner and FreeAgent Certified Practitioner
- year-end accounts and Corporation Tax return
- Companies House confirmation statement
- director’s payroll and RTI submissions
- VAT registration and VAT returns under Making Tax Digital
- your personal Self Assessment tax return
- advice on salary and dividends, expenses and pension contributions
- IR35 contract reviews and support
- dealing with HMRC on your behalf
IR35 and the off-payroll working rules
The off-payroll working rules (IR35) make sure that a contractor working through their own limited company, who would be an employee if engaged directly, pays broadly the same Income Tax and National Insurance as an employee. Who decides depends on the client:
- Public sector clients decide your employment status for tax
- Medium and large private and voluntary sector clients decide your status
- Small private sector clients: your own company decides whether IR35 applies
Where the client decides, it must give you a status determination statement with its reasons. The rules apply contract by contract, so some of your contracts can be inside IR35 and others outside. HMRC’s Check Employment Status for Tax (CEST) tool can help.
If a contract is inside IR35, the fee-payer deducts Income Tax and employee National Insurance before paying your company, and pays employer National Insurance itself. Student and postgraduate loan repayments are not deducted, so you will need to file a Self Assessment return to pay them. Read our IR35 guide.
Umbrella companies: new rules from 6 April 2026
If you work through an umbrella company, IR35 is unlikely to apply because the umbrella employs you. From 6 April 2026, the agency that contracts with the end client (or the end client, if there is no agency) is responsible for making sure PAYE is operated correctly by the umbrella, and HMRC can recover any underpaid PAYE from it. Check your payslips carefully, and be wary of schemes promising unusually high take-home pay.
Running your limited company: key figures for 2026/27
- Corporation Tax: 19% on profits up to £50,000 and 25% over £250,000, with Marginal Relief in between. The limits are shared between associated companies (GOV.UK)
- Dividends: £500 tax-free dividend allowance, then 10.75% basic rate, 35.75% higher rate and 39.35% additional rate (GOV.UK)
- Personal Allowance: £12,570
- Employer National Insurance: starts at £5,000 a year of earnings (the secondary threshold)
- Employment Allowance: up to £10,500 a year, but not if a sole director is the only employee paid above the secondary threshold (GOV.UK)
Dividend tax rates rose by 2 percentage points at basic and higher rate from April 2026, so it is worth reviewing your salary, dividend and pension mix. We will work out the most efficient approach for you.
Frequently asked questions
Should I work through a limited company or an umbrella company?
It depends on your contracts, IR35 status, income and how long you plan to contract. A limited company usually suits long-term contractors working outside IR35. An umbrella can be simpler for short or inside-IR35 roles. We can compare the take-home pay for you.
Can you help if my client says my contract is inside IR35?
Yes. We can review the contract and working practices, help you challenge a determination you disagree with, and make sure the deductions are handled correctly in your accounts.
Do I need to register for VAT?
You must register if your taxable turnover goes over the VAT threshold. Many contractors register voluntarily. We will advise on the right scheme for you. See our VAT services.
Talk to a contractor accountant
Based in Bathgate, we work with contractors across West Lothian, Edinburgh and the rest of the UK. Contact us for a fixed-fee quote, call 0845 862 6009 or message us on WhatsApp.
This page gives general information only and does not constitute professional advice. Figures taken from GOV.UK as at October 2026.