What is a private limited company – LTD?
Do you need to know how to establish a limited company (LTD) in UK?
First of all, a limited company is a type of organisation you can set up to run your business in UK, but not only here. In the case of a limited company, its ownership is split into shares owned by shareholders. A limited company must pay corporation tax out of any profits and can then distribute the remaining profit among shareholders. Not last, a limited company is run by directors who are legally required to perform certain duties for the company and its shareholders.
Limited means that the company has associates and their liability to the company’s creditors is limited to their initial capital contribution, i.e. the nominal value of the shares and any premium paid for the issue of the company’s shares. The private assets of an associate are thus protected in the event of the company’s insolvency, but the funds invested in the company will be lost.
The shares of a limited company are issued and the directors are appointed by the partners, Often, especially in small companies, they are the same people. The purpose of this type of company is to carry out economic activities and make a profit. The profit can be reinvested in the limited company to finance further development or distributed among shareholders as dividends.
The minimum requirements for establishing a limited company -LTD in UK are:
• There must be at least one director appointed
• All directors must be at least 16 years old
• The company must have a registered office address in the UK. For companies registered in Scotland the address must be in Scotland, for Northern Ireland the address must be in Northern Ireland and likewise for companies registered in England or Wales the registered address must be in England or Wales. Companies registered in Wales can have an English registered address as can English companies have a Welsh registered address.
• The chosen company name must not be exactly identical, or too similar, to any other company name currently held on the register at Companies House.
• The company must issue a minimum of one share at the time of incorporation.
The main advantages of Ltd′s compared with being a sole trader in UK
Maybe you previously considered the other possibility for you as an entrepreneur: setting up a sole trader in UK. What you have to consider are the advantages a limited company offer you as compared to a sole trader in UK:
• It’s easier to bring in other people
As compared to being a sole trader, the limited companies in UK offer this advantage to those who want to bring partners to their company. Giving your future partners shares means they have an incentive to make the limited company a success by further developing it.
• There can be tax savings
As a sole trader, if your income’s very variable, you can find yourself being a higher-rate taxpayer one year and barely using your full tax-free allowance the next. Having a limited company in UK allows you to pay yourself the same amount each year – so you can keep money in the company in good years and use it in leaner times. That helps you to smooth out your personal earnings, which can mean you pay less tax.
• You limit your losses in case of bankruptcy
You can set up a company without risking your house and savings.
Why should you choose a professional accounting firm once you have decided to set up a private limited company in UK?
Getting a professional accountant in UK is a great way to keep on top of your finances. They’ll remind you of important tax dates and payments due, show you ways of keeping your accounts in excellent shape, advise you on allowable expenses and how to report them so you’re as tax efficient as possible.
EuroWin Solutions is a well-established, modern accounting firm based in London. We offer Professional Accounting Services , Tax Advice and Expert Immigration Services. The firm has been established for 9 years with a team of qualified accountants, immigration advisers and tax specialists who have various industrial experience. We work with a large number of businesses, sole traders and individuals helping them achieve their goals through our pro-active and informative service.
Why Eurowin Solutions for helping you with the formation of a limited company in UK?
Nowadays, most UK companies are establish online. However, we provide advisory services beyond the standard company formation service in UK. We can have a company formed and ready for business instantly, with all the required paper forms in your possession within 24 hours. Whatever your requirements, we can tailor our services to your requirements and provide you with the best solutions at the best fee.For us, every client is important which is proven by our high customer satisfaction. We guarantee to deliver a high-quality service from a team of dedicated personnel who are professionally competent. Our fees are calculated on a fixed fee basis, so you know up front how much it will be, for the services you require. We work closely with our clients to ensure they receive expert guidance through the complex world of accounting and immigration issues.