Advice on setting up a Company, please

[roydo]

Personally I'd only set up a limited company if there were clear commercial benefits of trading through a corporate. Lots more filing obligations and administration to content with than running a partnership or sole trader business.

But if it all goes tits up? Limited is better then isnt it?

Asking for a nervous friend.

 

[aazak]

Personally I'd only set up a limited company if there were clear commercial benefits of trading through a corporate. Lots more filing obligations and administration to content with than running a partnership or sole trader business.

I know what you mean, but it looks like it might be one relatively simple answer to a number of problems/issues.
I'm based a couple of hundred miles South from you. If things go well I'll need a UK vat reg and address and an NI company might make sense for a few other reasons too.
Do you have any more info/experience on the filing / admin side of it?

 

[ToffeeTim]

But if it all goes tits up? Limited is better then isnt it?

Asking for a nervous friend.

Yes. The debt belongs to the company and not you personally. The company and you are separate legal entities. You do still need to fund all the working capital personally if you are a one man band company though.

It's dead easy to set up a company and not initially expensive (albeit it can be if you want the company articles to be very specific and require a lawyer perhaps), but you have to file accounts every year, corporation tax return, confirmation statement/Annual return. Unless you're sure you know what you're doing then you'll need to pay an accountant. There's also dozens of other scenarios where you need to inform companies house.

Company is the right choice for a small-ish enterprise if you are on top of the legal requirements in the UK, and especially if you expect high profits. Ie. Top rate income tax is 45, CT is 19%. He says he currently has no turnover, so my advice would be why burden yourself why you are starting up. You can always incorporate down the line if you get up and running and things grow well.

 

[roydo]

Yes. The debt belongs to the company and not you personally. The company and you are separate legal entities. You do still need to fund all the working capital personally if you are a one man band company though.

It's dead easy to set up a company and not initially expensive (albeit it can be if you want the company articles to be very specific and require a lawyer perhaps), but you have to file accounts every year, corporation tax return, confirmation statement/Annual return. Unless you're sure you know what you're doing then you'll need to pay an accountant. There's also dozens of other scenarios where you need to inform companies house.

Company is the right choice for a small-ish enterprise if you are on top of the legal requirements in the UK, and especially if you expect high profits. Ie. Top rate income tax is 45, CT is 19%. He says he currently has no turnover, so my advice would be why burden yourself why you are starting up. You can always incorporate down the line if you get up and running and things grow well.

Sold my business, (and liabilities, if they occur down the road) a few years ago mate.

 

[hibbo'sclass]

Personally I'd only set up a limited company if there were clear commercial benefits of trading through a corporate. Lots more filing obligations and administration to content with than running a partnership or sole trader business.

Not that much more onerous to be fair.
I reckon the admin for a close company takes well under an hour (including minutes for divis and divi vouchers). In terms of filing fees, £13 for CS, nowt for PSC or filleted accounts.
Veil of incorporation not what it used to be though. Suppliers will often ask for personal guarantees - the cheek!
Oh yeah, partnership and Ltd co file the same number of returns to HMRC, sole trader 1 less.
Edit -crossed with @ToffeeTim

 

[hibbo'sclass]

But if it all goes tits up? Limited is better then isnt it?

Asking for a nervous friend.

Small Enterprise and Business Act makes it easier for HMRC to come after directors to be honest.

 

[Moomin]

I'm looking at setting up a Limited Company in the Northern Ireland to start selling online into the UK. I have never set up a company before and I am not a UK resident so I would appreciate any and all advice. Does anyone have any experience in this? I know I could do it cheaper in England but I have a reason for choosing NI - this is how I am thinking of doing it:

£50 incl vat / year for a Belfast registered address from: https://www.mbe.co.uk/belfast/business/registered-office

£49.99 plus vat to register the company, register for vat (which I need), register for paye (which I don't need) and do the confirmation statement and other things from: https://www.rapidformations.co.uk/compare-packages/#limited-by-shares

Sell in your own country.

#Brexit means brexit.

 

[ToffeeTim]

What I would say is that I have massive respect for anyone who takes the plunge into running their own business, and I wish the government would support our local small businesses better.

 

[hibbo'sclass]

@aazak if you're not UK resident, profit extraction may cause more ball ache than you think in terms of double tax treaties, deemed tax credits, previous residence/domicile in the UK, personal tax in your country of residence etc.
@Moomin may have a point - if you are EU resident, it may be easier doing it through your home jurisdiction.
Just saying

 

[hibbo'sclass]

What I would say is that I have massive respect for anyone who takes the plunge into running their own business, and I wish the government would support our local small businesses better.

In fairness Tim, the Tories have done more to disincentivise running a micro entity than Labour ever did.