Some basic advice

Discussion in 'Accounts & Finance' started by D.G Holdings and Procurement, Jun 26, 2011.

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  1. D.G Holdings and Procurement

    D.G Holdings and Procurement UKBF Newcomer Free Member

    56 3
    Hi all,

    I have recently started an E-commerce business at the end of April. I informed the HMRC straight away of me effectively being self employed at this point (i am also full time PAYE employee with a large company)

    I have since limited the company name and registerred the company as dormant for name protection purposes only.

    My question is;

    If i now make any sales via my website does my company effectively become active?
    OR
    can the company remain dormant and then i declare any profit made on my SA tax return when prompted?

    Help and advice appreciated.
     
    Posted: Jun 26, 2011 By: D.G Holdings and Procurement Member since: May 15, 2011
    #1
  2. Scalloway

    Scalloway UKBF Legend Free Member

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    If you continue to use your sole trader bank account I can see no reason why the company shouldn't remain dormant. Remember you still need to file dormant accounts for the company to ensure its continued existence.
     
    Posted: Jun 26, 2011 By: Scalloway Member since: Jun 6, 2010
    #2
  3. D.G Holdings and Procurement

    D.G Holdings and Procurement UKBF Newcomer Free Member

    56 3
    I have a business bank set up as a sole trader with Santander. If i put all necessary cash flow through this the i can just file a continuance account with CH to keep the company dormant?
     
    Posted: Jun 26, 2011 By: D.G Holdings and Procurement Member since: May 15, 2011
    #3
  4. Scalloway

    Scalloway UKBF Legend Free Member

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    As far as I am aware that will be ok.
     
    Posted: Jun 26, 2011 By: Scalloway Member since: Jun 6, 2010
    #4
  5. D.G Holdings and Procurement

    D.G Holdings and Procurement UKBF Newcomer Free Member

    56 3
    OK thank you,

    I appreciate your help with this matter
     
    Posted: Jun 26, 2011 By: D.G Holdings and Procurement Member since: May 15, 2011
    #5
  6. MyAccountantOnline

    MyAccountantOnline UKBF Legend Full Member

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    What you have to bear in mind is that you and your limited company are completely separate - just because you trade it doesnt mean your company is.

    Do bear in mind any company, trading or not, must still complete an annual return and annual accounts (and send them to Companies House) just like a trading company and you will get fined if they are late. I've seen so many people caught out by this.
     
    Posted: Jun 27, 2011 By: MyAccountantOnline Member since: Sep 24, 2008
    #6
  7. D.G Holdings and Procurement

    D.G Holdings and Procurement UKBF Newcomer Free Member

    56 3
    Yes thank you for that.

    I do understand that i still have to file annual accounts even if the company is dormant but i didnt understand that me being self employed was separate from the company.

    Thanks again.
     
    Posted: Jun 27, 2011 By: D.G Holdings and Procurement Member since: May 15, 2011
    #7
  8. MyAccountantOnline

    MyAccountantOnline UKBF Legend Full Member

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    No problem at all - you truly arent alone. Many, many people get really confused with that one.
     
    Posted: Jun 27, 2011 By: MyAccountantOnline Member since: Sep 24, 2008
    #8
  9. zacharybarber

    zacharybarber UKBF Newcomer Free Member

    1 0
    Hello Everybody, I am new in business finance and I only know basic financial ideas. Business finance includes saving and lending money. Finance is one of the most important aspects of business management and includes decisions related to the use and acquisition of funds for the enterprise.
     
    Posted: Jun 28, 2011 By: zacharybarber Member since: May 7, 2011
    #9
  10. MyAccountantOnline

    MyAccountantOnline UKBF Legend Full Member

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    Hi - welcome to the form, you may be better posting an introduction on the introductions section.:)
     
    Posted: Jun 28, 2011 By: MyAccountantOnline Member since: Sep 24, 2008
    #10
  11. DeanCo

    DeanCo UKBF Newcomer Free Member

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    Being self employed means that your personal income is taxed with your business income. With a limited company your personal money is legally separate from the the company’s finances.
     
    Posted: Jun 28, 2011 By: DeanCo Member since: Feb 19, 2011
    #11
  12. D.G Holdings and Procurement

    D.G Holdings and Procurement UKBF Newcomer Free Member

    56 3
    I understand that.

    But with my company being dormant any money i make will be banked in my sole trader account and then declared upon SA return.
     
    Posted: Jun 28, 2011 By: D.G Holdings and Procurement Member since: May 15, 2011
    #12
  13. MyAccountantOnline

    MyAccountantOnline UKBF Legend Full Member

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    Hi - I hope you dont mind me mentioning it but have you taken any professional advice to see if it is beneficial to you to trade via the company? It can save some people tax to do so.
     
    Posted: Jun 28, 2011 By: MyAccountantOnline Member since: Sep 24, 2008
    #13
  14. MikeJ

    MikeJ UKBF Big Shot Free Member

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    I'd also ensure your e-commerce site has no references to the limited company on it.
     
    Posted: Jun 29, 2011 By: MikeJ Member since: Jan 15, 2008
    #14
  15. D.G Holdings and Procurement

    D.G Holdings and Procurement UKBF Newcomer Free Member

    56 3
    I have taken advice as initially i was not even going to limit the company. I was given advice and based on minimal expected turnover within the first year i believe it would be more beneficial for me to be sole trade. I do not want to have to pay corporation tax on the company if i am not making a lot of money through the company itself.

    I am aware though of the tax benefits but at this stage i don't believe it is the way i want to go

    @ mike - i have not got a reference to being a limited company on the website
     
    Posted: Jul 1, 2011 By: D.G Holdings and Procurement Member since: May 15, 2011
    #15
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