It is important to ensure that you hire a specialist contractor accountant who is aware of all legal requirements and obligations associated with running a limited company.
It is ultimately the director, i.e. you, who is responsible for making sure all legal documents are submitted to the correct authorities accurately and on time, however when you engage Churchill Knight & Associates Ltd as your accountant, they will assist you.
The principal benefit of trading through a limited company has always been the limited liability bestowed upon the company’s directors and shareholders. Assuming that the company is operated legally, the director’s personal assets are not at risk and shareholders are not liable for debts and obligations of the firm beyond the amount contributed.
A change to legislation over the last few years has meant that limited companies could potentially prove far more beneficial to self-employed individuals despite the higher running costs.
First time contractors usually choose between a limited company and an umbrella company. The only viable umbrella option is to use a PAYE Umbrella Company, which means all income is paid similarly to that of a contractor caught by IR35, which in turn can have a negative financial impact. Having said that, running a limited company comes with greater responsibilities than working through an umbrella company, and as company director, you are in control and make all decisions on behalf of the limited company.
Once a limited company is incorporated, the director or shareholder can begin trading whenever they like.
Leave a Reply