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Bank said I need to set up a limited small company but Im not sure Im not just SE, Help please!

(21 Posts)
SizzleSazz Tue 26-Feb-13 18:25:52

Employed or self employed status is set out here

Unfortunately setting up a service company does not necessarily help as you could be caught under IR35 rules

As long as you can tick most of the 'self employed' boxes in the first link (i think there is actually a check tool on that page) you will be ok. You don't have to register a limited company and you don't have to have a separate bank account.

flubba Tue 26-Feb-13 18:16:26

Haha! Yes, I think you might be right. grin

Does it make sense to wait until the new tax year to register, or won't it make any difference if I register now but have nothing to show for the current tax year?

Talkinpeace Tue 26-Feb-13 17:42:18

feel free to print out the me page and take a highlighter to it - strong coffee is also recommended

flubba Tue 26-Feb-13 17:37:53

My main problem is that I've done a couple of craft fairs and sold a few things to people I know (without realising that I should have registered), but won't have records of all of them by any stretch of the imagination. Is it best just to register as SE as of now, and then start being paper-smart?

flubba Tue 26-Feb-13 17:33:43

I did have a quick look the other day, but my 3 kids were crawling all over me at the time so I need to find a time when my head (and house!) are clear or at least quiet.


Talkinpeace Tue 26-Feb-13 17:27:18

Registering as self employed and all that ....
have a read through this and follow the links ....

flubba Tue 26-Feb-13 17:21:38

Okay, thank you. I think I need to sort that out soon then (and also register myself as SE once I get my head round what it all means and what I have to do! blush )

Talkinpeace Mon 25-Feb-13 13:30:39

I ran my sole trader business through our joint smile account for 12 years ...
you can have as many bank accounts as you like
I have one in each of my surnames

MoelFammau Sun 24-Feb-13 12:47:59

Sure. I have 3 personal accounts at the Co-op and 2 business accounts.

flubba Sun 24-Feb-13 06:34:42

But not with the same bank I presume?

ValentineWiggins Sun 24-Feb-13 06:24:00

Could you just have a second current account that you only use for the business? Then you've got your personal and business money separate anyway!

flubba Sun 24-Feb-13 06:18:57

Okay, thank you moel

MoelFammau Sat 23-Feb-13 22:50:21

No, I did this for years. It just gets messy if you have a lot of business related outgoings. Then having a business account clarifies things. But if it's just your wages going in, then there's really no benefit.

flubba Sat 23-Feb-13 22:09:47

If you are SE, is there anything illegal about using a personal account for a business? Or does it depend on the smallprint of your personal account?

MoelFammau Sat 23-Feb-13 21:22:45

Agree - bank is an arse.

TalkinPeace2 Tue 05-Feb-13 13:19:13

Bank talking bilge. Just want to charge you for a business account.
Talk to an accountant.

WilsonFrickett Mon 04-Feb-13 21:34:34

I asked my accountant about this last week. What he said was it would be an advantage to have a business account because it's cleaner - when it comes to my accounts, I'd know that every payment that came out was for the business. And if the taxman ever investigated me, they would look at all my personal payments which would be a pain. However, there's no obligation for me to have a business bank account. He also said the Co-op do free ones (must check that out).

As someone who used to work in a bank, some business advisors are very good. Others... less so. So take the Ltd Company advice with a pinch of salt. Basically, someone has noticed you're using your personal acc for business and thinks they'll make some commission selling you a business acc.

AmandaPayne Sun 03-Feb-13 16:11:54

Agree with Missy. The decision whether to incorporate is a complicated one, depending on your personal circumstances and also the demands of your clients (as she says, some clients will only work with Ltd companies). There is no one size fits all answer.

One big benefit to think about though is there in the name. If you incorporate, it is your company which is liable for any mistakes you make. If you are a sole trader it is you personally. This layer of protection can be useful depending on how high risk what you do it, and also the level of indemnity insurance you routinely carry.

MariusEarlobe Sun 03-Feb-13 16:06:39

Message withdrawn at poster's request.

MumOfMissy Sun 03-Feb-13 15:33:32

Ignore your bank. You don't have to be a limited company, you can just be self employed (sole trader). You don't need a business account (the bank charges you for those!). I am a se sole trader and just use my personal current account. The only problem you may have is if you only work for one company all the time, the tax people would say you should be considered an employee of that company. This is why companies often prefer to work with people who are limited companies, as it gets round that problem. My accountant tells me they are closing lots of the tax loopholes that made being a limited company worthwhile, you also have to register at companies house, submit annual reports and pay more to your accountant. You have to pay yourself a salary and dividends. It's basically much more complicated!

Not sure about tax credits as I've never claimed them, but very doubtful u could claim them as a limited company! Best bet is to speak to an accountant. You could continue as you are, there's always a risk the tax will pick up on it, but as far as Im aware it would be the company you work for that gets into trouble and would have to back pay your tax and Nat Ins.

MariusEarlobe Sun 03-Feb-13 15:21:33

Message withdrawn at poster's request.

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