going LTD

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richardbrown

richardbrown

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My accountant phoned me today and suggested I became a LTD company saying i could save £6k on tax next year but it sounds so complicated.

What do you guys think ????

thanks Rich
 
yep going ltd is a good call

I will be doing teh same when I come back from travelling

I think you pay tour self minimum wage then because you are a shareholder you take dividends then you only pay 10% income tax on that.....

Danny
 
Ive been asked to go Ltd in the passed by builders , i just glazed over , hope this helps anyway
 
I did it 10 yrs ago & i got a good lump of cash back every year.
But I went on the books with a firm for 18 mnths then went back as a subbie & never got round to setting a ltd company up again :(

But it's definetly worth it rich go for it mate, your accountant will sort it all out for you name searches etc..
plus you need a buisness account which you've probably already got.
 
Going LTD is all fine ,but if you want to rap up the LTD company it will cost you a ball of money,think about it first get some independant advice ,from someone other than your accountant,and weight up te pros and cons.See what suits you,and your wallet ,not the accountants ;)
 
sorry spreads i dont understand what you mean.

at the moment he charges me £180 to do my end of year return if that what you mean
 
Rich he means close the ltd company.
But to be honest spreads I never paid a penny to close mine about 6yrs ago!
 
Maybe its just here Nisus , but my mate got shafted.Sorry Richard Ill speak slower,Accountants can be as bent as some of the builders that you can come across,the only difference is ,that one has a degree,and robs you through the letterbox
 
I have a ltd company and find it much better. I pay myself a small wage every week and the rest in dividends once a month and it saves me a fortune in tax
 
i went ltd in april it cost me 115 to set it up and my accountant charges me 550 each year to look after everything
 
There are obvious benefits going ltd the main one tax breaks and probably as important is the protection from being bankrupted personally , as you are taking on bigger contracts this may me the most important benefit to you , you only need one company to go bust on you when you have laid out for mats and wages etc and it could be the end for you as a sole trader, but as a ltd company it's the company that goes into liquidation and not you that becomes bankrupt (unless it's proven that you knowingly traded whilst insolvent, then it could be jail ;D) , be careful what you list as company assets , get a good accountant and keep in touch on a regular basis, penalty's can be astronomical so be careful (up to ten grand fine and three years jail for no/late returns i think) lot's to get your head round mate but as has been mentioned you pay your self the max allowance before tax, 6k ish (£106 a week) and then a monthly/qaurtely,half yearly divi
 
My hats off to you Rich. I have followed many of your posts and you seem to be doing very well.

I can not help you with your question but I hope all goes well for you and you keep up the success.

There are too many stories of doom and gloom but you shine a positive light on things.

Well done.
 
I would guess that you may have alot of credit accounts and outstanding materials and say if a co. went bust on you and dont pay you then you will stand to lose personally your creditors if you are LTD you will not lose anything that is not in the company, alot going ltd of late because so m any firms go bust leaving us contractors unpaid so its a safe bet and you are more likely to get contract from builders by being LTD thats why they ask you to do it. My accountant held mine back for as long as possible before I set up just because you need the right business but its more hassle for sure. He knows you so his advice will be a safe bet I would think

Not sure if its worth it in this recession tho unless of course you have plenty of forward books
 
rich

also to add


when you go ltd you may find that credit accounts with suppliers will need to be re applied for


if you have an overdraft you may find they want a directors guarentee

also buying vans ,finance can throw up this problem


as the new company will not have a proven track record


this is how i understand it ---


martin
 
Did you go Ltd in the end Rich, im thinking of it myself cos i want to pay a low wage to myself my ex missus is trying to stiff me for Child maintainance the tw@
 
i have been ltd two times for tax reasons u need a lot of turnover for it to pay ur account will allways puch for it more work for him and when u close it down it can cost a lot depending on the assets in the company at the timeie vans tools that the company bought u see every thing belongs to the company and u become a employe
 
I have had a few ltd companies (other businesses) but traded as steve symington plasterng contractor for 30 odd years as a sole trader and was always getting hammered with tax etc and losing a few quid on VAT, anyway I set up Render Systems UK Ltd just over a year ago and havent looked back, ive had £ thousands back in VAT they owe me over £10K in tax (CIS) and i put every single expence down and claim back. I set the company up with a loan of £10k from steve symington plastering contractors, so the company runs at a loss for the first couple of years... as for costs, I pay accountants £2k a year which covers VAT, Corporation tax (Nil) CIS payments, and personal tax, they also deal with my rental properties, the accountants fees are tax deductable also... anyway hope this helps make your mind up... it works for me... also if you take a massive hit the company goes down not you and your family home...
 
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