ukshopz.com started this topic @ 00:33 on 24/05/2007
Hi all
A few questions regarding a new venture im starting up. This will be a part time venture initially alongside my current job.
Currently the business will not generate a huge amount of cash but I can see it growing as I sign up new clients and offer additional services.
Is there any advantage starting the business as a limited company rather than a sole trader. I think a ltd company gives the impression that the company is more professional and protects the company name. Any view on this?
I have other streams of income from another company I work for so my new startup wont generate much cash although this will grow. My main income stream will come from my other job. The startup will begin by generating only a few thousand a year until I expand the client base.
I expect that the accountancy costs for a ltd company (generating a low income) may eat into most of the profits until I expand the business.
Are there any benefits to starting as a sole trader or do you think I should stick to my original plan of a Limited Company.. Or perhaps I should be speaking to an accountant
Regards
Chris
------------------------
-----------------------------------------------------------------------------------------------
millionaireblog.co.uk - Millionaire blog - http://www.millionaireblog.co.uk
Free Blog showing you tips and tricks to put you on track to becoming a millionaire.
-----------------------------------------------------------------------------------------------
spybugs.co.uk -Audio Surveillance - http://www.spybugs.co.uk
=====================================================
RE: New Startup - Questions Re: Limited Company/Sole Trader
James Smith | 24/05/2007 09:26 AM
Chris,
I would tend to agree with starting as a sole trader in your circumstances, there isn’t really much point incorporating form the off given the costs of compliance and the way the tax landscape is moving against them. There can be some kudos being a company but normally not a lot given how easy they are to form. Quite often customers are unaware of their supplier’s business structure. Really the only types of business forced to incorporate early tend to be product based businesses where some wholesalers will only supplier “serious” business that are VAT registered and a limited company.
Regards,
------------------------
James Smith
Chartered Accountant
www.jamesesmith.co.uk
01235 536 773
---------------------------
Your indispensable guide to Small Business Bookkeeping, Self-Assessment & VAT
RE: New Startup - Questions Re: Limited Company/Sole Trader
imprint | 04/06/2007 06:51 PM
James and Chris,
I hope you don't mind me jumping on your post! James, I had an additional question for you. I'm also setting a business up am in a similar dilema as Chris. My business will be in fashion though (small brand, not big brands like Nike) so I'll be selling products. What you say above makes me think that I'd be better off being a company. Do you think I would be better doing that (company)?
Does this have any bearing on when I can open up business bank accounts for the new project? I was about to do this. Would trying it out as a sole trader first and then incorporating (if I didn't get accounts for example) later on be a good idea?
I've been self-employed for a few years but am nervous about the thought of setting up a company.
Thanks for your time. Chris, good luck with your business!
Cheers
RE: RE: New Startup - Questions Re: Limited Company/Sole Trader
ukshopz.com | 05/06/2007 12:32 AM
Thanks Imprint appreciated
Ive spoken to another accountant who suggests I should go as a ltd company
1st for the protection and no personal liability
2nd for the tax implications
He mentioned if Im thinking of growing the business quickly and view it as a long term project its probably easier to start as ltd at the outset..
We will see

------------------------
-----------------------------------------------------------------------------------------------
millionaireblog.co.uk - Millionaire blog - http://www.millionaireblog.co.uk
Free Blog showing you tips and tricks to put you on track to becoming a millionaire.
-----------------------------------------------------------------------------------------------
spybugs.co.uk -Audio Surveillance - http://www.spybugs.co.uk
=====================================================