Going out alone

[Paul117]

Hi

Forgive me if this topic has been covered many times before but I am new to the forum and rather than dig up old threads with possibly outdated info I thought I'd start a new one.

I have been an electrician for 10 years and now feel the time is right to set up my own company. I believe the work is there if you are good enough.

I will be handing in my notice in around a year, this gives me enough time to build a client base by working weekends and evenings. I have got the ball rolling with NICEIC membership as I intend to trade legitamitly and legally. This also gives me time to raise funds to set up and build a "cushion" to live off if things are slow to start with.

My question is this, is it best to register with Comapines House immediately or wait until I am fully self employed. Just thinking for tax reasons, paying and claiming business purchases back against my tax.

Also is it generally better to be a sole trader or register as a limited company?

Any help and opinions would be greatly appreciated.

 

[SJD]

For a limited company, you normally have to submit accounts 1 year after formation (you can adjust the year-end date a bit, if needed) unless you are a dormant company - which you wouldn't be, if you are doing jobs. You will need an accountant for this (which costs £100's), so bear that in mind. You can submit pre-trading expenses (6 months for expenses, I think, longer for captial equipment) so if you have bought tools or services, you can do that before company formation.

I can't comment much about being a sole trader, I wanted the limited liability status of a company, so avoided that option.

 

[Octopus]

Sole trader is far less hassle initially. Get an accountant to review your books year by year and they'll tell you when to go limited.

Call HMRC, they don't bite, especially when you are asking for advice.

 

[adammid]

In my opinion, start off self employed. If you are only working evenings and weekends, you do not want to pay an account hundreds of pounds to do your accounts, set you up as a limited company when you will not be making much money. Start off self employed and then if things are going well then go LTD after you have handed your notice in. Good luck. Its not easy out there.

 

[HandySparks]

If you're going self employed, register with HMRC as soon as you start, even if you're employed as well (you can be both at the same time).

 

[telectrix]

as above. you would only involve companies house if you go ltd. as a sole trader, all you need is to inform hmrc.and do self-assessment tax returns.

 

[Midwest]

I'm doing something similar, retiring next year from my current job and going self-employed as an electrician. Won't be on a large turnover as I will have a pension, so I will go a sole trader. I went to see an accountant for advice. Most offer a free initial one to one. If you keep your accounts/books up to date, with receipts, bills, you yearly accounts bill will only be a couple of hundred pounds. My son's a plumber and he does his own books. I've decided to use an account for an easy stress free life. The less time they spend on your accounts, the less money you are charged. The company I'm going to use offer a web based spreadsheet, to upload all your weekly bills/receipts client payments (£15 a month). Get a separate bank account for your business, to keep things simple. I think you only need to go LTD, if youturn over goes high and you can be exposed to risk, as a sole trader has no unlimited liability. ‘Google’ it, there’s plenty advice out there. Here’s a government web site: Business support, information and advice | Business Link

http://www.brookson.co.uk/working-o...sole-trader/?gclid=COvc3PWG-LACFW1ItAodRHzaAQ