Dilema needs help pls

[CloudClara]

I need some advice please. I have started a small wedding planning business for which I arrange weddings in for one location, in addition to my full time job. This season making £600. Having now got a large number of enquiries for next year I have come to set it up properly and thinking it better to have the liability with the Co and not me, I incorporated a Ltd co last week BUT now having serious second thoughts as I think the expenses out weigh the benefits.
As I said I have a full time job paying tax and ni already so this is extra income.

So what can I do as I am now doubting I have done the right thing and it would be better left as a sole trader. My turnover is quite high as I invoice for all the services but profits a lot less as of that amount I only keep my planners fee after I have paid the venue. I am really stuck and I need some advice. On the incorporation I said I was already trading so how to I tell HMRC I made a mistake and don't want to run this ltd co and remain a sole trader?

Second question - Seeing as I already have a full time job am I better off registering myself a sole trader or Ltd co for this extra work? :|

 

[Scalloway]

HMRC and non trading companies


http://www.hmrc.gov.uk/ct/getting-started/trading.htm#2

You will also need to inform HMRC that you want the company struck off

http://www.companieshouse.gov.uk/infoAndGuide/windingUpCompany.shtml

It can be advantageous for tax to trade through a limited company if you have employnment income.

 

[MyAccountantOnline]

I need some advice please. I have started a small wedding planning business for which I arrange weddings in for one location, in addition to my full time job. This season making £600. Having now got a large number of enquiries for next year I have come to set it up properly and thinking it better to have the liability with the Co and not me, I incorporated a Ltd co last week BUT now having serious second thoughts as I think the expenses out weigh the benefits.
As I said I have a full time job paying tax and ni already so this is extra income.

So what can I do as I am now doubting I have done the right thing and it would be better left as a sole trader. My turnover is quite high as I invoice for all the services but profits a lot less as of that amount I only keep my planners fee after I have paid the venue. I am really stuck and I need some advice. On the incorporation I said I was already trading so how to I tell HMRC I made a mistake and don't want to run this ltd co and remain a sole trader?

Second question - Seeing as I already have a full time job am I better off registering myself a sole trader or Ltd co for this extra work? :|

Running a limited company really shouldn't cost much more than operating as a sole trader and can often save tax (specifically National Insurance) for someone such as yourself who is also employed and receiving a salary from another source.

You really need to get some specific advice from an accountant based on your circumstances. Many firms such as mine offer this via email if its easier for you whilst in full time employment.

I'd get some proper advice before contacting HMRC and making any decisions yourself. Hope all goes well for you

 

[Michael Davies]

My advice to you would be to definitely operate as a limited company. I don't know how much you receive in your employment. But i know it definitely provides you with taxable benefit taking money from a limited company than a sole trader.

If you need more info you can PM me.

Hope this helps

 

[jf-financial]

tax can of course be a very good reason to incorporate but in your case it sounds like the limited liability is as big a reason. You could cover this off to some degree with insurances though.

I don't always like to rush to advise a Limited company status as with certain people and businesses I prefer people sometimes to run their businesses as self employed for a bit so they can get the measure of things.

When Limited you need to be more disciplined with how you take money out of your company and how you run it but an Accountant will of course help with that.

Also worth considering is that the bigger you grow before you incorporate, the more potential there is for a bigger Goodwill value to be apportioned to the "sale" to your company, which is very tax efficient.

It's hard to advise for sure without more specifics which route is best, but I would say if you're more comfortable being a sole trader why not run it like that for a year or so - yes you'll be losing some tax benefit - but if you feel better running it like that for the time being than do so.

You have a company setup already so you can either strike it off or perhaps tell HMRC it's not trading and just file dormant accounts and your annual return at companies house and keep it for the future...

One thing to bear in mind - you mention a high turnover level as you re-bill on various costs - you might be well off it but watch out for the VAT threshold biting you