[Eddie_Rhone]

Had my annual meeting with my accountant today, he has suggested that I become a Ltd Co the last couple of years and said It again today. His arguments
about saving tax are very good but I'm not sure had a plumber friend who changed to a ltd company and goes on about it been the worst thing he ever did. So what is the experience of people on here is changing to a ltd co good or bad. 

Eddie

[mark joyce]

its relevant to what you have and earn and dont want to loose if it all goes bandy!!!

but it will also give him the chance to up his charges Massively so be careful   

[elliott cleaning]

It depends entirely on the status of your business as well as your personal status.  No one other  than a good creative accountant that knows  the relevant circumstances can advise you.
If your plumber friend is so perturbed about his situation there is nothing to stop him changing back to sole trading

[derek west]

ive been advised to go ltd too, will be having a chat with my accountant in the next week or so to discuss it.

[Paul Heath]

Must be something in the air....we been advised to go LTD as well....can't make our mind up

[PaulKing]

ive been limited for the last 15 years worth every penny

[Doctor Carpet (Ret'd)]

Yep, I went ltd in 2002. best thing I ever did.

The simple thing is that you're t/o and more particularly your profit puts you in a position whereby the exta accountancy charges you will pay are far exceeded by the tax you save. Your accountant wouldn't recommend it unless the figures stacked up.

Apart from that it also gives you some protection in case the wheels came off your business-protecting your personal assets from the company's creditors (excluding any guarantee you may need to give to your bankers if you are borrowing from them. (Email me if you want further info on this.))

Some say it also makes you look more "professional" and/or a bigger organisation and therefore more creditable in the eyes of clients.

On much of your paperwork you won't even have to mention that you are limited if you still prefer to give the image of being small and personal.

Rog

[Ian Rochester]

Been Limited for a few years now,

The only downside is the additional accountants fees as they need to supply a set of audited accounts for submission to Companies House each year, our accountants fee is £395 for the year against £195 for sole trader accounts.

On the plus side, you pay less tax as you take a basic wage (£7,200pa) and then a company dividend which incurs 20% tax as opposed to drawings which incur 23% tax.  Plus if it all goes tits up, your house and savings are safe.

I would disagree with Rogers comment though, you do need to declare your limited status on all paperwork as this may affect a clients perception of you and how they treat your credit rating, you cannot hide behind ltd status if it is not on your paperwork. 

I have just taken an individual sole trader to court when they defaulted on a payment, none of their paperwork said they were ltd, but they were and they tried to hide behind it.  The court ruled in my favour as they had not been open about their ltd status,  she now has a CCJ against her as an individual..... so her credit rating is now basically f..ked!!

[Steve Barnett (Carpet Care Plus)]

You'll have to give me the name of your accountant Ian - I paid nearly £600 last year for sole trader accounts !

[John Kelly]

We went the other way from Limited to a Partnership. As well as paying tax on your dividends you also pay corporation tax on your total profit before you take your dividends out. You also have to run a PAYE scheme as you would no longer just be a sole trader but a director who is an employee of the limited company.

[Warren Aldridge]

You'll have to give me the name of your accountant Ian - I paid nearly £600 last year for sole trader accounts !

Jeez mate.

Keep really good records of your ins and outs and just fill in a self assessment form online yourself. Costs £0

[Carpet Dawg]

You'll have to give me the name of your accountant Ian - I paid nearly £600 last year for sole trader accounts !

£600!! thats alot of bones Steve!

I pay £249 a year. Including VAT

Just seen Warrens reply. Yeah keep records of your in's and out. Keep all recipts etc And then catagories everything, monlthy income and outgoings. Takes a few minutes a week to keep on top of this.
Making it easier/quicker (cheaper) for the accountant to fill in your tax return for you.

I would recommend you get an accountant to do the tax return for you though!

Tony

[Steve Barnett (Carpet Care Plus)]

To put that price into perspective - I run a day book which is reconciled monthly against bank statements,
I present a fully itemised and reconciled purchase ledger and all receipts are filed in date order in a monthly folder.

My accountant is actually a client of mine - I have carpeted his house from top to bottom and also his kids houses - perhaps he's trying to claw some of that back.

[JandS]

With Warren on that.
Claim for everything to do with your business
and do your own incoming and outgoings.
You have to do it for the accountant anyway so
all you have to do then is do the online tax return
which is a doddle to do now anyway.
If in doubt about whether you can claim for something
or other queries just ring the tax office, they are
quite helpful.
It is not rocket science if your a sole trader so why
pay others.

John

[Ian Rochester]

We thought we claimed for everything we could, my wife is an accounts technician and records everything, however, we gave it all to our accountant and he proceeded to save us a further £8,400 on our last years tax bill.

You may think you are saving money be doing your tax returns yourselves, however in reality you are probably costing yourself more than your saving. 

The thing to do is take your last years self assessment and a copy of your accounts to an accountant, ask him to look over them and see if he/she could have saved you anything on what you paid.  If they can save you more than they cost you, then it's worthwhile.

[derek west]

totally agree with ian, i had a very big profit this year and still not paying tax thanx to my accountant, and all above board before you ask, woop woop.

[AshWhite]

Derek,
Did you just say 'woop woop'?
Any respect I had for you is now gone.
I'm afraid you're dead to me now.

Ash

[Steve Chapman]

Derek,
How is it possible to make a large profit & not pay any tax ?

Regards
Steve

[Ian Gourlay]

probably because he has offset his expensive truckmount costs
Then he probably had a big write down of stock when he went out of Market Trading .

 and became a Carpet Cleaner

[Mike Halliday]

I thinkits more likely he has mis-worded what he was saying, you pay tax on your profits...... more profit- more tax unless I'm missing something.