the pros and cons of sole traders and limited co

[kilty55]

whats the pros and cons of changing from a sole trader to a limited co?

 

[Daz]

It's all about the money Jamie.
My accountant advised that it becomes tax efficient when you are clearing around £25k+ profit every year. If you are less or on the threshold then it is generally considered that it is beneficial to be a sole trader.

If you become a limited company you will have additional business costs such as accountancy fees and year on year financial statement filing etc.. You will benefit from tax efficient dividend payments etc..

Your best bet will be to discuss matters with your accountant and take personalised advice.

 

[Stewart]

Jamie, that's a tough question for an alcohol fuelled Saturday night. The main differences are tax liabilities, double entry book keeping, and limited liabilities when it goes **** up.

Book keeping becomes more involved and accountants bill become bigger. You pay yourself less and hopefully give yourself a bigger dividend. Your accounts are open to public scrutiny to certain extent.

With a good accountant, going Ltd can pay off, but it's not for everyone, and depending on turnover, it may not be a positive financially.

 

[tfs]

In addition to tax beneifts, Limited liabilty is a big factor for many people who are in a business where debts etc are high risk then limited can be a good option if you have much to loose.

 

[kilty55]

that answers that then...back to the drink guys lol

 

[DHTiling]

LTD..is basicly .. if you go pop then no assets go with as a business..,. you do not lose your home etc no assets are claimed against you as a comp..grumpygrouter will explain in full.. it is simply business .. by going ltd then it is a less risk to you and more of a risk to your creditors.. good luck.

 

[Pebbs]

All of the above and be prepared to be bored out of your skull with accountants, rattling on about accurals, projections, corporation taxes, and long words, which you nod your blonde fluffy head to...ohh no sorry thats me that only does that.

Lynn

 

[kilty55]

All of the above and be prepared to be bored out of your skull with accountants, rattling on about accurals, projections, corporation taxes, and long words, which you nod your blonde fluffy head to...ohh no sorry thats me that only does that.

Lynn

does it help being blonde pebbs? do they give you more leeway? if so i can do the hiar dye thing i dont mind lol