Company Registration

[Lee Ballard]

My accountants advice was that only worry to go Ltd if you are going to be taking out lots of credit with suppliers and your bank. Otherwise no need it just makes the accountants bill larger though I’m sure others on here will be able to offer different points of view.

Lee

[David Rowland]

Sole trader without registering for VAT… if you start doing lots of work and need to give your customers more VAT benefit or you buying and reselling a bit, then you can start looking at VAT registration, after that start looking into Limited once you got your feet firmly in the ground.

[Chris Dowd]

quote Dave Rowland:

Sole trader without registering for VAT… if you start doing lots of work and need to give your customers more VAT benefit or you buying and reselling a bit, then you can start looking at VAT registration, after that start looking into Limited once you got your feet firmly in the ground.

Dave, I think your missing a BIG pointer here. Sole Trader, Partnership, LLP or Limited Company once you hit the VAT threshold, you must register for VAT.

In our line of business, I would voluntary register for VAT if my turnover was blow the threshold, pure and simply because most customers our industry supplies are VAT registered. It also has the benefit that you can claim back the VAT on any capital purchases etc.

As for Limited Company or not – regardless of whether you have your "feet firmly in the ground" or not, take advice from your accountant as he/she will know whether you and your business would be best suited Ltd.

[Robert Lambie]

we do have a good accountant, nice friendly guy, knows his stuff and we have used him for a good few years now.

still….

i think 90% of these guys work more for the government than us… 😕

.

😀

[Nicola McIntosh]

quote Robert Lambie:

i think 90% of these guys work more for the government than us… 😕

yep ed would agree with you there rob 😀

nik

[Phill Fenton]

I agree with Chris. Registering for VAT even if below the threshold when starting out is a good idea in this type of business as most of your customers will be VAT registered themselves.

Ltd. or Sole Trader? There are pros and cons in each. Your accountant is best to advise.

Make sure you get a good accountant – a good accountant will save you money in ways you would have no way of knowing about if you tried to do it all yourself.

You can even trade as a sole trader and also set up a limited company with your trading name to prevent anyone else using it. Your limited company can remain dormant requiring some simple paper work each year to keep it on the register while you continue to trade as a sole trader or partnership.

[David Rowland]

but he said first business? When I started out as a computer engineer, I was earning and selling my services only and not selling computers or parts through myself, seemed pointless as no company could claim VAT back so I just told them where to buy it and I fitted it, when my profit started to rise I was ready to start getting more serious, however the only thing I needed to do is register as Self Employed.

Lots of people have different circumstances and the 3 month VAT thing can be a nightmare on finances for someone who may have not been there before. Lots to learn if you not had a go before, I still get confused with some of it.

I do agree if you want to register for LTD & VAT then do so, but if you haven’t got anywhere yet then don’t register until you have a clear picture of the government mechanisms and had good advise.

[Chris Dowd]

Dave,

I would agree to not VAT register voluntarily if you are running a "service only" business like your first. However, Warren, like the rest of us provide a product (and also have set-up costs (i.e. Kit) which the VAT can be claimed back on).

quote Dave Rowland:

but if you haven’t got anywhere yet then don’t register until you have a clear picture of the government mechanisms and had good advise.

Think we’d better all de-register then as I don’t think anyone (not even the Government) has a clear picture of the Government mechanisms!! 😀 😀 😀

[Warren Beard]

Thanks for the reply guys, there are a lot of points here that will help me.

I think the first thing might be to find a good accountant and then decide which route to take. I will still be working full time at my current job and making signs part time but hope to go full time during this year some time.

I can’t register myself as self employed if still working full time as well, how can I be a sole trader if I don’t register as self employed? Will this mean I will have to create a LTD company? am I totally mad?

Any more advice would be greatly appreciated.

cheers

[Nick Minall]

quote Warren Beard:

I can’t register myself as self employed if still working full time as well

I think you can be employed and self employed at the same time you need to talk to them and find out mate.

Nick.

[Martin Pearson]

This question of registering for VAT or not registering is one that I have never really understood. I know all the rules about claiming VAT back but my actual expenditure on things like materials was fairly low compared to the cost of the products I was selling as in this industry there is a lot of labour involved.
So how do you decide what is best? Most people on here have said you should register voluntarily for VAT in this industry but when I sat down and tried to work out the fore and againsts it seemed like I would be paying out a lot more money if I registered.

[David Rowland]

well I might be coming out of self employment now (depending on my accountants advice), but the last few years I have been fully employed and also self employed. Only main snag is two lots of National Insurance.

[Lee Husselbury]

You can be self employed and employed, my wife still is and i was for a short time.

I never got vat reg for my first business as i was below the limit and it did seem like alot of extra work.

[Dave Harrison]

Register as a sole trader, I’m pretty sure you can do this while still in full time employment. You’ll have to fill in a self-assessment tax return every year, which you will be asked about other earnings ( keep your p60’s ).
Not sure how the NI side of things work, but I’m sure no-one should be paying double NI contributions. .. I think Daves got something wrong somewhere !

[Warren Beard]

Thanks for all the responses, I think I will need to try find a good accountant and take it from there, I think starting as a sole trader now for a while and if, sorry "when" I am doing this full time and successfully I might open a LTD company.

Does that sound right? or should I stay with self employed or sole trader if I start out that way?

and can I change from a sole trader to a LTD company?

Thanks

[Andrew Bennett]

quote Warren Beard:

and can I change from a sole trader to a LTD company?

Thanks

Yes, thousands did after l2005 years budget to take advantage of the tax breaks which will be withdrawn at the next.
The suggestion of registering at a LTD and leaving it dormant is, i am told, done a lot. A electrician friend of mine just did exactly that on the advice of the Tax Office (he is a start up following redundancy and went to them for advice) they do free half day introductions apparently.

[Warren Beard]

4 years on and it’s now time to become Limited :lol1: My accountants have informed me that the savings I would make being a limited company are in the 1000’s so seems like the obvious thing to do really (and this is after the increased accountant fee’s)

My questions is would you change to a limited company to save a few grand a year in tax?

and for those of you that are limited do you trade under your limited name or "trading as" another name? I ask because I looked at about 50 sign company websites and maybe 2 of them had "limited" in their name/logo and wondered why?

cheers

Warren

[George Elsmore]

Warren, they probably do not have limited on their website for a shorter web address, i know thats the reason I don’t have limited in my web address

[Gary Birch]

quote George Elsmore:

Warren, they probably do not have limited on their website for a shorter web address, i know thats the reason I don’t have limited in my web address

Same here. Although I trade as limited.

Wow 4 years. Time flies mate!! Seems like yesterday 😮

[Warren Beard]

Sorry for the confusion, I didn’t mean on the web address, I mean the company name on the website (or your business cards, letterheads etc etc)

It seems everybody would rather trade as "Mr Sign Company" and not "Mr Sign Company Limited"

I was thinking of changing to my limited name when I go limited and wondered what your thoughts are of doing it this way (Limited name basically the same as current name so just adding "and graphics limited" as I couldn’t get just my company name.

Cheers

Warren

[Warren Beard]

quote Gary Birch:

Wow 4 years. Time flies mate!! Seems like yesterday 😮

I know, been reading through my last 3 posts about logos and company name etc and was very nostalgic about how far it’s come and how many pages of help I received was great. 😳

Again I say I’m not sure how far I would be at this stage if it wasn’t for this forum (yes it’s a pat on the back to Rob (and everybody here who helps make it great) 😉 :lol1: )

cheers

Warren

[Martin Pearson]

What I find incredible is that you managed to find a specific post you made 4 years ago, I struggle with the search engine :lol1:

Warren just out of interest if your business is still basically the same as it was only with you making more money how is your accountant now going to save you a fortune if you go limited?

[Warren Beard]

quote Martin:

What I find incredible is that you managed to find a specific post you made 4 years ago, I struggle with the search engine :lol1:

Warren just out of interest if your business is still basically the same as it was only with you making more money how is your accountant now going to save you a fortune if you go limited?

Hi Martin

The salary and dividends I take and the way the tax rate is calculated on it, also National Insurance, I think a few other small things but mostly those, my accountant took my figures and calculated what I would have saved if I was limited and it was about £3k 😮 (so that’s basically what I lost this year by not being limited)

As for the search engine …… I was lucky :lol1: I also have a problem with it but as I knew it was my post I searched for a word I knew I would have mentioned and only searched for posts by my name.

cheers

Warren

[Martin Pearson]

Probably involves taking a small salary from the business and getting the rest in dividends or something along those lines. Wonder if your Accountant was chartered when you started :lol1: (Sorry I’m an old cynic.)

As for the business I would just keep it the same as it is at the moment, you don’t have to put your limited name on anything other than your letterheads if I remember rightly and that was tiny writing at the bottom of the page which said that " Bert’s signs was a trading partner of Berts House Limited" or words to that effect. Oh think it was on a notice in the shop but not where anyone could really see it without looking.

[Warren Beard]

that’s right Martin, you just need to state it on official documents or something like that which is fine, I just wondered if there was a perception of a business who traded as a limited name and that’s why there are so few that do it, or is it just because 99% of them started as sole traders and when they changed they just kept using the same logo?

The thing is (and I’m sure you will remember) after the long thread on my new logo design it has actually evolved further since then and I have created a bigger brand/image which I am very much recognised by now, so I am looking to refine my logo/image a little and can take the opportunity to add the extra words in.

I did notice a lot of sign companies are called "…….. and graphics" My new limited name would add the "and graphics limited" to the name and so far my logo ideas look nice with it in (so I think anyway :lol1: )

So why don’t more companies have the "limited" at the end of their names if they are limited?

Warren

[Martin Pearson]

I can think of a few reasons Warren, haven’t put a lot of thought into it as I’m old but off the top of my head:

They couldn’t get the name they wanted to trade under as a limited company because someone else is using it. They have more than one business but all companies operate from one limited company. It’s an extra word so maybe they think their signs would cost more, it’s an extra word so they can’t get their name as big :lol1:

The first 2 are probably the most likely but I like the second 2 best :lol1:

Oh and as you said if they started small and grew then maybe just to keep the same identity as people already know it or they have never seen the need to change or wanted the expense.