limited company of sole trader

[simonm]

What are the pro's & cons to becoming a limited company over a sole trader?

[Dorset Treeman]

Biggest pro is that your own possessions (house, car etc) are completely separate from the business when you are a limited company so should somebody decide to sue you, these cant be taken into account whereas they can be if you are a sole trader.

[Dorset Treeman]

Downsides of being limited is that my accountancy bill increased by around 50% and I was forced to open a business bank account where they charge me for PAYING IN MONEY !!

[simonm]

Downsides of being limited is that my accountancy bill increased by around 50% and I was forced to open a business bank account where they charge me for PAYING IN MONEY !!

 

Why did it increase so much? I have a business account that charges me but if your clever you work around it, no cash goes in gets spent on fuel wages consumables etc. any cheques go in and gave to pay 80 p per cheque I tr and get most people to do a bank transfer as they don't cost nowt

[Billy]

Accountancy goes up because the money you earn is no longer 'yours' it belongs to the company so you get paid via payroll like your employees and the accountants have to organise can books etc etc. the main benefit is you save tax and NI, more so if you are on the higher rate as corporation tax is 20% as opposed to the higher tax rate of 40%.

[Andyd1606]

Why did it increase so much? I have a business account that charges me but if your clever you work around it, no cash goes in gets spent on fuel wages consumables etc. any cheques go in and gave to pay 80 p per cheque I tr and get most people to do a bank transfer as they don't cost nowt

 

 

What bank are you with my one Barclays still charges for bank transfer. They are the cheapest option and I try to get as many payments as I can but it still adds up over the month.

[GA Groundcare]

There's lots of pros and cons and what works for one business won't for another. I went limited straight away when setting up the business. Payroll, employees, business account, accountant etc but for selling and servicing the machinery with a depot it's really the only way.

 

There's loads of good information on the Gov websites so maybe set aside an evening to browse, take notes etc. An appointment with a business advisor where you can just sit and tell them what you do and how your business works may be worth the £. You'll learn a lot.

[simonm]

What bank are you with my one Barclays still charges for bank transfer. They are the cheapest option and I try to get as many payments as I can but it still adds up over the month.

 

Barclays m8 charge me if I pay cash or cheque but bank transfers are free.

[simonm]

There's lots of pros and cons and what works for one business won't for another. I went limited straight away when setting up the business. Payroll, employees, business account, accountant etc but for selling and servicing the machinery with a depot it's really the only way.

 

There's loads of good information on the Gov websites so maybe set aside an evening to browse, take notes etc. An appointment with a business advisor where you can just sit and tell them what you do and how your business works may be worth the £. You'll learn a lot.

 

Good idea, I got rid of my old accountant because they weren't very helpful! My new 1 is offering help and advice and says that setting up a limited company will save me £££s in the long run.

[Hodge]

Why did it increase so much? I have a business account that charges me but if your clever you work around it, no cash goes in gets spent on fuel wages consumables etc. any cheques go in and gave to pay 80 p per cheque I tr and get most people to do a bank transfer as they don't cost nowt

 

 

So you don't pay any cash in to the bank? You may have trouble if you ever get looked at by the Tax man, he will want to know things like where the cash has come from and where it's gone, then he might be a bit curious as to is there any other cash that you have been getting and not declaring, then you have to prove him wrong not him prove you wrong.