Ltd. Company

Financial, legal, advertising, pricing, marketing, accountancy, bookkeeping, employment, taxation, etc.

Ltd. Company

Postby Ed209 » Tue Dec 04, 2018 9:25 am

Just wondering the advantages/ disadvantages of becoming a ltd. Co.
We are considering taking on new premises that will be double our current rent and mean committing to a lease as opposed to our simple no commitment rental shop.
I suppose my biggest worry is if something happened to me and I was tied in and committed to paying out on the lease rental
and having our house liable if we got in to financial difficulties.


!-!
User avatar
Ed209
 
Posts: 303
Joined: Sun Mar 05, 2017 9:22 pm
Location: Birchington-on-Sea, Kent
Organisation: Birchington Framing Centre
Interests: Guitar, woodwork, cycling Singing

Loft

Re: Ltd. Company

Postby Tom Chambers » Tue Dec 04, 2018 10:25 am

I recently started a new framing business and went Limited for several reasons, firstly it protects you financially should business struggle, secondly it was so easy to set up and very little cost. Having been a sole trader and Ltd over the years I say both do not take any more work (as I believe you should have proper financial controls in place no matter). The other aspect mentioned to me is that suppliers, customer etc. can feel that dealing with a Ltd company is safer option. Best to speak with accountant to make sure which is best for you, I was lucky that one of my neighbours is an accountant and he was the one who explained how easy a Ltd company was to set up and the better protection it gives, especially if renting premises etc.

Cheers
Tom
User avatar
Tom Chambers
 
Posts: 25
Joined: Wed Aug 22, 2018 6:17 pm
Location: Dalkeith
Organisation: Framed By TC
Interests: Photography

Re: Ltd. Company

Postby Rainbow » Tue Dec 04, 2018 11:43 am

Ed209 wrote:I suppose my biggest worry is if something happened to me and I was tied in and committed to paying out on the lease rental
and having our house liable if we got in to financial difficulties.

I would suggest looking into critical illness insurance in case you become too ill to work, and life insurance in case you die during the lifetime of the lease. Such policies should cover the lease costs (at least) and give you & your family peace of mind.

Bonne santé in the meantime!
User avatar
Rainbow
 
Posts: 402
Joined: Tue Jun 23, 2015 9:51 am
Location: England
Organisation: Picture Sales & Framing
Interests: Picture framing

Re: Ltd. Company

Postby poliopete » Tue Dec 04, 2018 10:06 pm

Hi Paul :D

I don't pretend to know anything about being a Ltd Company but I would certainly look into it. I understand your concern regarding your home.

I'm surprised no one has come along as yet who is registered as an Ltd. Company :o

As Tom said, have a chat with your accountant or bank manager and perhaps get a free half hour with a solicitor for his/her view.

As an aside, a close family member died a few years ago heavily in debt to one of the big four banks. After he passed away the debt was written off and his close relations were not in the least liable.

Looking at your website and seeing the very high standard of your work and knowing how hard you work, I am confident you will make a success of your new enterprise.

Very best of luck whatever you decide.

As Del Boy would say "he who dares wins" :giggle:
poliopete
 
Posts: 384
Joined: Mon Apr 04, 2016 8:13 am
Location: The Wash
Organisation: Annie Lou Fine Framing
Interests: Caring for my wife, Picture Framing and Natural History

Re: Ltd. Company

Postby David » Thu Dec 06, 2018 12:24 pm

I converted my business to a Limited Company, on advice from my accountant, it was a combination of tax situation which was better than being self employed and we had two businesses on two sites and it clearly seperated the businesses so if anything happened to one the other should be 'safe'. The issue with signing a lease as a Limited Company is the first thing they ask for is a personal guarantee so a Ltd Co is no protection. There is more paperwork and regulation, not much but you need an accountant to take care of it.
http://www.silverstoneframing.com
User avatar
David
 
Posts: 338
Joined: Sat Sep 08, 2007 11:24 pm
Location: Silverstone
Location: Silverstone
Organisation: Silverstone Framing
Interests: Photography, Motor Racing, Military

Re: Ltd. Company

Postby Framerpicture » Thu Dec 06, 2018 3:49 pm

Most of the tax advantages of being a Limited Company have disappeared since the introduction of the dividend tax. It does offer some protection, but personal guarantee's will still be required for leases's, loans and probably overdrafts

A possible advantage going forwards, is that if we hard Brexit, which is looking increasingly likely, I think reducing corporation tax will be one of the tools used to retain business in the UK . Maybe not a reason to rush to form a company though.

My instinct tells me to batten down the hatches and prepare for a complete lack of customer confidence, at least in the short term.
http://www.churchgategallery.co.uk/
Follow us on Twitter@PorlockArt
User avatar
Framerpicture
 
Posts: 839
Joined: Thu Jan 18, 2007 3:38 pm
Location: Somerset
Organisation: Picture Framing
Interests: Mountain Biking, Walking,


Return to Business Matters




 
Picture Framer's Trade Directory
Picture Framer's Oracle

 
Members Map Header
Members Map
More info
Resources Header
Contact Forum Admin
Directory
How to include an image in your post
Cove Box Designer
Download Designer
General supplies
Glass
Machinery
Mounts/Mountboard
Artists
Conservators
Prints
Software
Tuition
UK Medals
Framers Forum Live!
Support Header
Crimson
White
Green
Violet
Advertise Header
Forum Banner Ads