AlivewithTechnology started this topic @ 10:26 on 30/11/2006
I've previously setup a ltd company to provide website design. As a side line I'm also developing a website which will offer services to the travel industry, but at the moment I'm going to run it as part of my ltd company for the simple fact I wont have to do 2 sets of accounts, have 2 business bank accounts etc etc.
Now, say in 1-2 years time this website I'm developing becomes popular and I want to setup it's own limited company rather than being part of another company, would I need to have that part of the business valued and buy it from my original ltd company?
I'm not sure how these things work, but seeing as I own the limited company, and the ltd company owns the website, then surely I own the website and can do as I please?
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RE: would I have to buy a website from my own ltd company?
James Smith | 30/11/2006 12:02 PM
The short answer is that in this scenario you would need to sell the trade from one business to the other at market rates. This would trigger a charge to corporation tax in the company selling it.
However there is more than one way to deal with this and it questionable whether you would want to do actually have a second company.
As ever with limited companies- speak to your accountant about this sort of issue WELL BEFORE you actually do anything. It may make sense to legally own the domain personally and lease it to the limited company.
Once you have done these things its a lot harder to backtrack and re-do the right thing rather than doing it correct from day one. Its not like a sole trader where you can be dug out of a hole at the year end – with a company you need to do it right from day one.
If for some reason you have set up a company without any advice and you need some help 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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