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I often read intelligent informed opinion/advice on here(not always!!!) and would be very interested if any of you could help me with the following
I am finally starting my own business and was wondering what the major benefits are in being a private ltd company vs sole trader?I am starting the business with approx 50k so not enough or need to be a public ltd
company
Basically I could do with any experiences you guys have of setting up a business and pitfalls to avoid
Thanks
I am finally starting my own business and was wondering what the major benefits are in being a private ltd company vs sole trader?I am starting the business with approx 50k so not enough or need to be a public ltd
company
Basically I could do with any experiences you guys have of setting up a business and pitfalls to avoid
Thanks
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Replies: 15
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keep your business to yourself ... sole trader the only way.
As soon as you go limited, the world will be after you (regulation, regulation, regulation). And forget the smart-ar$e accountants with their tax advice and lower tax rates for corporations talk ... just do work for cash as far as possible and pay whatever tax you want. By the way, I am an accountant, I'm an international management consultant (well was accountant and international mgt consultant until I found I could make more money - and legitimately tax free - than I ever did working for numpties in the corporate world). No fee for this advice. Good luck. |
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Depends on the type of business but if you are expecting profits to be above £15k then it is worth looking at incorporation for tax saving.
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neworder, what kind of business are you starting up
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More red tape and expense with a company but possible tax benefits.
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As said above, depends on the type/source of work.
Some clients won't touch you if you're not LTD, as they could be liable if you default on tax |
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Don't work for corporates unless you want to pay tax.
Don't forget that your taxes pay for MPs expenses, unemployment benefits, foreign aid, UK defence (highly corrupt), EU, etc, etc. Sole trader the only, choose how much, if any, tax to pay. Cash is king. |
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GET A WINDOW CLEANING ROUND
HEALTHY AND TAX FREE |
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Buy a small warehouse
fill it full of fur coats get well insured sneak 90% of the coats out in the middle of the night set fire to it the next night collect the insurance oy vey!! retire |
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mememem
thanks for the advice and good wishes.I am doing alot of research so see where it all ends up, think I was just after a regular persons real experiences of doing this any more info and advice from anyone will be appreciated |
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If you're a small business the only advantage of being Ltd is credibility ie appearing to be bigger than you are.......of course if you want to play about with limited liability thats another question. I always preferred to stay a sole trader for the simplicity of it.
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neworder
my "advice" was tongue in cheek and extreme - but nonetheless not far from being good advice ... it all depends on your business and your aspirations. If you will be working for corporates, especially if you provide services such as IT, then limited it is, I'm afraid - and red tape and regulation. And if your aspiration is to build a business, then limited again is he way forward (ultimately, but sole trader for starters will be ok). And don't ignore the VAT registration net, once in this then the red tape multiplies. My simple advice is sole trader if at all possible ... in business you should (well everybody should) KEEP IT SIMPLE ... my consultancy career was due to corporate numpties being really clever and making things complex. And just look around at any business and many are doing just that ... they think complexity = clever, I see complexity = moron. And, again, good luck. |
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I've had to set up a Limited company for the missus before and it is a bit tedious. She had rather simple circumstances, no tax and NI and the accountant was charging about £300 per year to look after it. Given that I knew i wasn't going to pay tax or anything and it would only earn a small amount I thought i'd do it all myself.
You need to set up a separate Bank Account which is a bit of red tape. I got first year free and then they charge you something like £6 a month running expenses. Then you have reporting duties to Companies House and HMRC which are pretty dull and that is when your affairs are extremely simple. I had no VAT, PAYE or NI or any tax to worry about. The other side of it is it might be better taxwise having a limited company. My understanding (which may be wrong) is that unless you are earning above the higher tax threshold rate then there isn't really much of a financial advantage. Of course having said that if you have a non-earning partner then you can bring them into the company and utilise their tax-free threshold but you would have to balance this out with the accountancy costs. I wouldn't set up a limited company until I had to or I felt that it was permanently worth my while (especially as closing the company down is a bit slow and dull as well). And when it is worth your while you would definitely want an accountant to do it all for you. I would say have a meeting with a local accountant and get them to go through what is involved and what services they provide. They will know all about tax breaks and could give you advice as to whether it would be financially beneficial before you make your decision. Good luck. |
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CASHINVEST 11 Dec 14 17:00
"GET A WINDOW CLEANING ROUND HEALTHY AND TAX FREE" Yep, healthy and tax free and plenty of fresh air....... what could possibly go wrong ? ! [ This image is no longer available. ] |
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☺
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u.a ,mememe, appreciate your replies........thank you
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