Hi Welshspark
There is a fine line on the decision. Why do you want to go ltd?
When i set my company up i weighed up the options for ages until my accountant basicaly told me to go Ltd. Luckily for me he is a good friend too and explained all the pro's and cons.
The main decision for me was because i have a military pension coming in and i needed to be able to limit the amount of money coming into the house because of my partners income and various other things. You have to be careful though, for example, profits made by the business will be subject to corporation tax, if you then pay yourself out of those profits, they will be taxed again. What you need to be able to do is ensure that at the end of the tax year, you have paid yourself what you want from the business and that the profit for the business is zero or less !!
It's a complicated system, you need to have an accountant (who will probably pay for him/herself through thier advice).
As Eddie says, the 'Ltd' part of the deal limits the amount of liability of the company with respect to damages or loss to clients. Being the Director of the company, you are still liable for debts etc incurred to the company. ie you will not lose your house if you f*&k up, but you will if you are responsible for accumalating debt on behalf of the company.
I hope this has helped a little, it's a big decision to make buddy, good luck.