New Business Venture

Thanks for the reply James.

The initial idea would be to create a consultancy firm and take on these two companies as clients. Would this overcome the problem do you think?

There is of course also the problem of what to do about the additional website business form a inland revenue point of view!

If anyone has any advice as to the best way to set-up the two businesses and incorporate these current 'clients' i would be very interested. Also any start up advice would be helpful.

Thanks guys

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G8 Marketing - www.g8marketing.co.uk
Client examples:
Audits Unlimited - Independent utility consultants - www.auditsunlimited.co.uk
Cosmopolitan Hotels - 3 star group in Glasgow - www.cosmopolitan-hotels.com
AC Milan Junior Camps in the UK, France and Spain
McCarthy Recruitment - www.mccarthyrecruitment.com

There is no conceptual problem in having more than one activity in one limited company - you just need to ensure losses from one aren’t offset against profits from another for tax purposes - the real initial issue here is one of employment vs self employed status It would be worth having a look at the section to your left on IR35, which is part of the dealing with tax section. This explains the general issues regarding your employment/self employed status. The fact you have two contracts and another activity will help, but the issues remain as to the nature of the contracts. It will be a case of defining IR35 compatible contracts to ensure you are truly self employed in the eyes of the revenue. This of course assumes that you WANT to be self employed. There are actually quite a few benefits of employment in terms of holiday pay, sick pay and the fact they have to give notice of termination, redundancy pay, pension facilities etc, and if offered it might make sense to be an employee of both companies. It would normally be a case of negotiating the most benefit position for you, the company would probably prefer you to be a contractor as it saves them quite a lot of money in terms of the above and in taxes. If you need any specific help in drafting compliant contracts etc then please let me know. Regards,
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James Smith
Chartered Accountant
www.jamesesmith.co.uk
01235 536 773

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*New* Your indispensable guide to Small Business Bookkeeping, Self-Assessment & VAT

I just have a quick question, i take it the income from any website would be liable for tax in the country of which it is registered? What would happen for example if i set-up this company and moved abroad, would i pay tax in this country still, or in whatever country i live in.

Obviously its important to consider all the possible options as working abroad is one of my aims for the future and any business i start just now will obviously affect this.

Thanks again for your help with this

------------------------
G8 Marketing - www.g8marketing.co.uk
Client examples:
Audits Unlimited - Independent utility consultants - www.auditsunlimited.co.uk
Cosmopolitan Hotels - 3 star group in Glasgow - www.cosmopolitan-hotels.com
AC Milan Junior Camps in the UK, France and Spain
McCarthy Recruitment - www.mccarthyrecruitment.com

Overseas issues are very complex (it makes IR35 look like a walk in the park), The very basic concept is that if you have a UK company it pays corporation tax in the UK unless due to agreements with the other country in which you are resident, it pays it elsewhere. Your personal taxes (ie on profits extracted from the company as say a dividend) will generally be based on your country of residence. Income from o/seas websites would generally be liable in the UK both if you have a UK co and if you are a sole trader and UK resident. As I say this is a massive topic with many "ifs" and "buts", and you would need to take appropriate advice based on your circumstances before planning your non residence strategy. Regards,
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James Smith
Chartered Accountant
www.jamesesmith.co.uk
01235 536 773

---------------------------
*New* Your indispensable guide to Small Business Bookkeeping, Self-Assessment & VAT