Ltd company

[Pedroski]

Can you not get your accountant to do all the registration work.It doesn't cost much more.

No need to - the registration is dead simple, and there's a ton of useful business info there. Also, I'm between accountants at the moment - existing one being me doing my own books, and now looking for one who knows more than the one my work mate has.

[volvo]

No need to - the registration is dead simple, and there's a ton of useful business info there. Also, I'm between accountants at the moment - existing one being me doing my own books, and now looking for one who knows more than the one my work mate has.

 

A good accountant should not cost fortune to do all the work for you.At least there should not be any mistakes that the lay person might make.

[skyhuck]

I'm with a large accountancy firm, it costs me £2000+VAT per year, but they do deal with all my accounting for that, Ltd Co, mine and my wife's personal tax, VAT, tax credits, etc,

 

I've been VAT registered for 12 years and never had an inspection, your expected to have one every 5 years, I wonder if they know the firm I use are on the ball so don't bother inspecting???

[volvo]

skyhuck im in basically in the same situation as you except its a family firm that i use.They once told me that hmrc dont really bother with the same checks that they would with a normal accountant /bookeeper.

[Cosmiccrofter]

Hi guys

 

If I may add my twopenneth. I have this very conversation with clients at least twice a month every month.

 

I'll go thru a short list of ='s and -'s. you can then decide for yourself which is the best option for you and your business at this or any other particular moment in time.

 

1. Partnerships are easier to set up and cheaper to run. As long as you have a good partnership aggreement written before commencement of trading.

2. Until such times as the business is t/o in excess of £55-60K per partner the admin/tax/admin savings are very much in the partnerships favour. Obviously the closer the business gets to this threshold so the balance swings the other way.

3. If you are concerned about personal financial liability as a partnership you can take out insurance. Bear in mind that this is not tax deductable!

4. It is easy to set a limited company up. You can do it yourself on line for as little as £35. You will need to get 2 other legal forms which you get from HMSO completed and noterised which will cost you an additional sum of about £60.

5. You can register a limited company name at Company's House and hold it in reserved for as long as you continue paying the yearly fee and sending in your annual forms.

6. The main advantages of being a limited company are you accountsants ability to move the tax goal posts around in the company's favour. However this comes at a cost in additional admin and accountancy costs. However accountancy costs are tax deductable. There is no selfassesment tax submission for Limited companys.

7. All directors of limited company's are now required to draw a salary. This however is not subject to the R&R regarding minium wage.

8. Directors salaries are subject to personal NI contributions as well as tax, and the company is also liable for employers NI contributon on all salaries.

9. However tipping the scales toward a income derived largely from dividends has a knock n effect in regards to company and personal pension allowances.

10. Taking you maxium 20% tax band salary and topping up your income from the dividend pool is often the most popular solution for directors. Depending upon other income streams of course.

12. Dividends are not subject to NI and are taxed at a lower rate than salaries. Your accountant with advise.

11.Always give ample consideration to partners and directors insurance. Seek advice from your IFA.

13. It is advisable to ensure you have adaquate Professional Liability Insurance as well as the other statatory insurance requirements. 3rd Party and Employers insurance etc

14. All company vehicles that have a personal usage are subject to tax.

 

The above is not a comprehensive list but it should give you a start into understanding the differnces and the various complexities of running a legal business be it as a sole trade. partnership or limited company.

 

My advise to anyone is to seek professional advise before making any decisions. Guessing or taking a stab in the dark inevitably ends up costing more in the long run.

 

My advise is to alway base your decisions on what is right for you, your partners/dirctors and the business at the time. Act early and don't prevaricate. Business's that are well managed survive, those that aren't eventually go to the wall.

 

For those looking for more free advise before deciding to spend some money with a professional advisor, accountant or IFA. The BusinessLink web site has an absolute mass of information and advice that is easily understood and in continually being updated. Business support, information and advice | Business Link.

 

p.s. No I am not touting for more clients, I'm getting ready to retire. But if I can help via the forum, I will.

 

 

Atb FR

 

This is a perfect example, if you are thinking of incorporating your business, of why you should have an initial conversation (usually free) with a qualified accountant to take you through the pros and cons of incorporation, and of the minefield if you get it wrong.

[HCR]

Interesting read this, but I have to that as someone who has just started a new business and and is weighing up the pros and cons of incorporation, I'm none the wiser!

 

Other than for the need to talk to an accountant about it...