A few words on forming a Limited Company from our partners at Walton Accountancy
- A Limited company is a legal entity. It can make its own financial commitments and pays tax on its profits. A director’s or shareholder’s personal liability is limited to the value of the shares that they own.
- A Limited company presents a more professional image to your customers, and once registered, your sole right to use that company name is protected in law.
- Agencies and contractors usually insist that their sub-contractors operate as a Limited company, or through an umbrella company.
- A Limited company can operate a small payroll for the director(s). This way, a full class 1 national insurance contribution record can be maintained.
- Directors are paid through a combination of salary and dividends and are not considered self-employed. They are employees of their own Limited Company.
- Being the director of a Limited company carries responsibilities and obligations. Accounts must be filed at Companies House (public record) and HMRC, and the costs of compliance are higher than those for a sole trader.
In order to meet your obligations as a director and to ensure your limited company is operating tax efficiently, we would always recommend engaging with an accountant when your company starts to trade. We offer a full range of accountancy services from limited company accounts and payroll/VAT registrations, to business advice and tax planning. All our services are inclusive of free unlimited support and advice. For more details, please visit our website on www.waltonaccountancy.co.uk or call us on 02392 593917.