Will a lot of small domestic tree firms go bust?

[Clutchy]

17 minutes ago, John Shutler said:

absolute rubbish 

 

Is anyone actually going to explain why it is beneficial to be a sole trader? 

[Mick Dempsey]

15 minutes ago, Clutchy said:

 

Is anyone actually going to explain why it is beneficial to be a sole trader? 

What are the advantages of being a limited company?

(no dog in the fight, but curious)

[woody paul]

The answer to the question is, he how has anything on finance is not probably going to make it though. 

Sole traders or Ltd makes no difference if you cannot pay it back its going back. 

[Clutchy]

Mostly the limited liability and for divs. If you're a one man band, with a a couple of subbies. You drop a tree on a car or house for example and the insurance company wiggle out of it (read an insurance policy in detail, theres a lot of ways they can get out of paying) for example you didn't realise there was a height limitation on your policy or any other nuance (subbie didn't have the ticket he swore he did etc). 

 

Client sues you for £35k. Your business doesn't have £35k, well, a charge might be placed on your family home, savings can be stripped etc where as with a limited company, they can only take whats in the company. Note that limited liability has no reference to legal liability. If you are grossly negligent and someone gets killed, you may go to prison either way. A few more plus' below    

•  
• You are protected by limited liability which means only money you choose to put into the company, and money that is made by the company is at risk of loss
• Limited companies often benefit from the reputation of being less risky to work with or buy from than sole traders as many customers feel there are more reliable recourses if they are dissatisfied with a product or service, so you may be able to grow your business faster and easier than as a sole trader
• Your company name is legally protected and cannot be used by another business
• You have increased chances of securing finance from investors and lenders as a limited company compared to sole traders
• As a shareholder of your limited company, you are entitled to receive dividends. This means you can receive up to £2,000 in dividends tax-free and all dividends received in addition to this threshold is taxed at a lower rate than income tax.
• There are increased tax planning opportunities including re-investing profits into the business to reduce corporation tax, making family members shareholders to issue dividends and reducing National Insurance contributions by paying less salary and more dividends.

[doobin]

The real benefit is the limited liability. There’s  not much in it if anything as regards tax benefits, especially with corporation tax due to rise. 

[Mick Dempsey]

So the only real advantage is that if you’ve misread or lied on your insurance and you fook up big they can’t come after your personal assets.

[Clutchy]

1 minute ago, doobin said:

The real benefit is the limited liability. There’s  not much in it if anything as regards tax benefits, especially with corporation tax due to rise. 

Somewhat agree if you're a biz with no aspirations to grow. 

 

The tax benefits come down the line, in the event you sell the business and get to enjoy entrepreneurs relief (one of the best tax reliefs there is) 

 

 

Limited liability is enough of a benefit to out weigh being a sole trader in this risky industry alone. 

Bad things can and do happen as well know 

[Clutchy]

2 minutes ago, Mick Dempsey said:

So the only real advantage is that if you’ve misread or lied on your insurance and you fook up big they can’t come after your personal assets.

Or fail to meet contractual obligations, there are lots of situations where it is nice to know you can keep your family home and other personal assets totally separate from your risky business. 

 

You say 'only' real advantage as if its not a HUGE advantage

[doobin]

Just now, Clutchy said:

Somewhat agree if you're a biz with no aspirations to grow. 

 

The tax benefits come down the line, in the event you sell the business and get to enjoy entrepreneurs relief (one of the best tax reliefs there is) 

 

 

Limited liability is enough of a benefit to out weigh being a sole trader in this risky industry alone. 

Bad things can and do happen as well know 

Agree on the liability front, you can go Ltd whenever you like though. 

[Mick Dempsey]

1 minute ago, Clutchy said:

Or fail to meet contractual obligations, there are lots of situations where it is nice to know you can keep your family home and other personal assets totally separate from your risky business. 

 

You say 'only' real advantage as if its not a HUGE advantage

I see what you’re saying.

Especially if your sending teams out unsupervised (by you) making decisions based on how quickly they can get home.