Sole trader or Ltd company with out VAT

[Capstankid!]

Thinking of starting up again but this time I have a house and possessions that I wouldn't want to lose. I doubt I would be out of work as a freelance worker and I am not planning on financing anything at the moment.

 

I am swaying more towards the Ltd company but the thing that puts me off is the having to have a business bank accounts (I hate that you have to pay to take your money out). Anyways, does anyone have any experiences with doing this or any advise?

 

Cheers.

 

 

If in doubt cut it out.

[treequip]

They charge for cash over the counter but just get a card

[darren@dynamoaccounts]

There's plenty of banks out there that do 18-24 months without charges. Also, if it's just internet transfers in & out, there are web based tariffs with the main banks that don't charge for these transactions, only for using over the counter and cash.

 

From a tax perspective, depending on the level of earnings may be beneficial but you have mentioned protection with the limited liability as being important. The limited company also gives a bit more credibility when dealing with new customers.

 

As for VAT, if your customers are registered for VAT could be beneficial so that you can claim the VAT back on your costs.

[treequip]

You can also transfer the funds to your personal account and take it over the counter FOC

[Capstankid!]

Thanks for the replies, that has cleared a few things up.

I wouldn't want to go with the Vat as at the moment it's just private work so know one would want to pay 20% extra.

Rbs seem to be doing a good deal at the moment so I might go in for a meeting and see how much smoke they can blow up my arse.

 

 

If in doubt cut it out.

[bolthole]

Thinking of starting up again but this time I have a house and possessions that I wouldn't want to lose. I doubt I would be out of work as a freelance worker and I am not planning on financing anything at the moment.

 

I am swaying more towards the Ltd company but the thing that puts me off is the having to have a business bank accounts (I hate that you have to pay to take your money out). Anyways, does anyone have any experiences with doing this or any advise?

 

Cheers.

 

 

If in doubt cut it out.

 

Join the FSB (Federation of small businesses) and then go for the Co-operative bank FSB business account. It's free and in fact I think they give you some sort of token annual cash bonus - like £50 or something. Can''t exactly remember.

 

I may have let my FSB subscription lapse last year but still have the account. Joining the FSB is worthwhile in itself, but that's probably another topic...

[Capstankid!]

Thanks will have a read up about it.

 

 

If in doubt cut it out.

[Tanat Valley Firewood]

If you are selling firewood (you don't say what line you are in), the VAT on heating fuel is only 5%, which you off set by claiming the full 20 % back on the VAT that you have paid out.

 

I am with Santander, just finished the free twelve months. My firewood customers pay by bank transfer and I get updates on my phone. The cost is £7.50 a month which is well worth it for me.

 

Good luck.

 

Daniel

 

Sent from my D2303 using Arbtalk mobile app

[Stephen Blair]

Are you wanting to be lLTD to cover yourself in case you go belly up?

Have you a failed business already?

My first thoughts which are from a Moral standpoint is, pay your bills, if you make a mess of things then tough,sell your kit and house and pay people that need paid.

Secondly if you make a big mistake and you need to claim your insurance say against a tree through a house or injure someone then you can't hide behind a LTD company like a lot of people think, you are responsible, they will come for you and rightly so.

Maybe if you are Apple or IBM you could hide behind paperwork barriers.

As far as bank charges, if you are worrying about £15 a month as a cost then maybe forget being in business.

Ltd company in my eyes is for 1 reason, to keep tax at 20% and avoid the higher tax brackets.

[Ian C]

Stephen pretty much hit the nail on the head, the days of hiding behind a LTD company for the small business are gone, my finance needs a personal guarantor as does my bank over draft, there are benefits but the days of racking up massive debt and simply being able to walk away are long gone which IMO is a good thing as it makes people responsible for there actions.