Limited Company - Part Man, Part Monkey

Are you in the process of forming a limited company? Do you need to know how limited company laws can affect your decision? You might be wondering if it is really necessary to form a limited company when your business has always been run as a sole trader or business partnership.

One advantage of operating a business as a sole trader or business partnership is that you can save money because you only have to pay the one corporation tax that is due each year. This one tax payment is due regardless of the size of your business. You will also avoid personal income tax on your profits. It is less of a hassle to not register your business for corporation tax.

But when you begin to look at limited company laws, the benefits of being a sole trader and a business proprietor do not negate the need to use limited company laws when starting up a new company. One example of this is that you are required to retain all current partners and to grant them a lifetime share of the assets and stock. There is no lifetime partnership. You need to ensure that your limited company is setup so that you can transfer all of your assets and your interest in those assets to your heirs upon your death.

By registering your new company for corporation tax, you can get all of your business assets on the company books, giving you the control to close the business and start a new one. You need to be able to close the company when you want to.Chick here for more details about limited company new company

Another disadvantage of a limited company is that there are no shareholders to decide on management decisions. There are ways to delegate the task of running the business to an accountant and business consultants. But you are ultimately the owner of the company.

Limited company law, therefore, gives you the power to exercise control over your business and to determine who will run it. You can be assured that you can do what you want with the company, whenever you want to do it. The choice is yours.

The disadvantages of a company operating as a sole trader are the long-term cost of maintaining a personal income tax and the potential loss of opportunity to do new things and make new friends and connections. A business is not a social club. The big advantage of being a business owner is having the ability to make your own choices and make choices for your business.

As a result, it is important to understand that when you become a new company owner, you will have a very different type of life than your family and friends. While there will still be a need for you to ensure the company's continued success, it will be far less stressful and demanding.