Expanding Limited Company

hi eHyena,

and welcome to the forum.

I am sure you accountant had good reasons for their advice, however when dealing with a small limited company there is no real reason for not running both sides as part of the same company. If for tax reasons you have two separate trades then you may need to keep quite good records of both activities and report these as essentially two divisions, but fundamentally you can do this within the structure of one company which means less hassle and lower costs for you.

Your accountant - if they are any good - should be able to explain in plain English exactly why they are advising you should have two companies and why they don’t want you to run both activities from the same structure. There are advantages especially if you foresee selling off one of the businesses in the future so this could be their line of thinking but I personally would have thought the hassle factor now would be more important than a potential exit but they will presumably know your affairs in detail and be able to give appropriate advice.

I hope this is of some help to you.

Regards,

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James Smith
Chartered Accountant
www.jamesesmith.co.uk
01235 536 773

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

Dear James,

Thank you for your useful advice!

Cheers!

eHyena