However, they may not be experts in the legal and financial aspects of running a business and such matters often appear daunting. Fortunately you do not need to be an expert in these fields to succeed in business, but you do need the support of a team of trained experts.
Here at S Smith & Co Accountants in Scunthorpe we can help to guide and support you every step of the way
We will help you with:
When setting up a business, one of the most crucial factors to consider is the type of company that you want to form. It is essential as the taxes you pay and the liability you have totally depend on the type of your business structure. We give you professional advice on whether you should have a sole trader company or a limited company to make sure that you must pay the least possible tax. Moreover, we do all the paperwork for you too.
This is the simplest and easiest form of business to register. You are a self-employed sole trader if you start working for yourself and you must register this business with HMRC. As a Sole Trader, the business is run by you.
You are therefore entitled to keep all of the profits as income but will be liable to pay tax and national insurance by filling out a Self Assessment Tax Return. There is no maximum amount you can earn, but it can become less tax efficient in the higher tax brackets.
You will be responsible for all liabilities and this includes all personal assets as well as those jointly-owned with another person.
A Partnership involves two or more individuals that agree to share in the profits or losses of the business. They share the risks, costs, benefits and responsibilities of running an organisation. Partnerships are referred to as unincorporated entities in that the partners are self employed. They are personally responsible for the losses or debts that the business undertakes.
Each partner is also responsible or liable for other partner’s negligence or misconduct. The profits or losses from a partnership will be shared between the partners. This will be in the agreed profit sharing ratio and each partner pays tax on their share of the profits.
An LLP is similar to a partnership except that the partner’s liability is limited to the amount of money they invest in the business. The LLP must be registered at Companies House and with HMRC. Annual accounts also have to be prepared and filed.
An LLP can be incorporated with 2 or more members and a member can be an individual or a company. Members responsibilities and share of the profits are set out in an LLP agreement and all members must submit a personal Self Assessment Tax Return every year, pay income tax and National Insurance on their share of the partnership’s profits to HMRC.
A limited company is a privately managed business, owned by its shareholders and run by its directors. The company is a separate legal entity with its own legal rights and obligations. This means the company is responsible for everything it does and its finances are separate to the personal affairs of its owner(s).
Any profits generated are retained by the company, after it pays Corporation Tax. Only then can the profits be distributed to shareholders in the form of dividends. Limited companies have annual reporting and filing requirements with both Companies House and HMRC.
Once decided on the structure of your business, you will need to get registered for the things like VAT, Payroll, CIS and Pensions etc. Our team of Scunthorpe accountants will carry out the relevant registrations, support and guide you along the way keeping you updated with progress.
To receive further information on starting your business our team at S Smith & Co Accountants in Scunthorpe, Epworth & Brigg will be happy to help, please call us on Scunthorpe 01724 848343 or email accounts@ssmithaccountants.co.uk.
