Some basic advice

[D.G Holdings and Procurement]

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.

 

[Scalloway]

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.

 

[D.G Holdings and Procurement]

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?

 

[Scalloway]

As far as I am aware that will be ok.

 

[D.G Holdings and Procurement]

OK thank you,

I appreciate your help with this matter

 

[MyAccountantOnline]

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.

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.

 

[D.G Holdings and Procurement]

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.

 

[MyAccountantOnline]

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.

No problem at all - you truly arent alone. Many, many people get really confused with that one.

 

[zacharybarber]

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.

 

[MyAccountantOnline]

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.

Hi - welcome to the form, you may be better posting an introduction on the introductions section.

 

[DeanCo]

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.

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.

 

[D.G Holdings and Procurement]

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.

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.

 

[MyAccountantOnline]

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.

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.

 

[MikeJ]

I'd also ensure your e-commerce site has no references to the limited company on it.

 

[D.G Holdings and Procurement]

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.

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