Starting 2 Companies

Discussion in 'Accounts & Finance' started by MrStar, Dec 30, 2020.

  1. MrStar

    MrStar UKBF Newcomer Free Member

    11 3
    Hi,

    I'm in the process of putting together 2 new ventures. One will give me regular low ticket work (computer repairs), the other is consulting to the financial services industry, projects will be infrequent but the value of them will be high. I'll also be doing some youtube videos to help with both of these and will hopefully bring in further income.

    The problem is I'm not sure if I can do both of these things under a single Ltd Company, or if I should create separate companies with separate bank accounts etc. I would prefer a single entity with trading styles as it means a single bank account, single company, and means I can offset losses from one company against the other but I can;t help but think it's odd to have such different activities taking place under the same LTD company.

    Can I have your thoughts on the best way forward please?

    Thanks
     
    Posted: Dec 30, 2020 By: MrStar Member since: Jun 30, 2020
    #1
  2. Rawlinson Pryde

    Rawlinson Pryde UKBF Regular Free Member

    125 29
    You have several options:

    1. Do it in the same company and same bank account but you need to record your income and costs separately as they are 2 different trades.

    2. Do it in the same company and different bank accounts, may make the recording of your income costs easier.

    3. 2 companies but have one that owns the other, then you can group loss relieve between the two, which would also give you added protection if you feel one of the activities is more riskier than the other by moving the profits up to the top company.

    4. There are other options.
     
    Posted: Dec 30, 2020 By: Rawlinson Pryde Member since: May 9, 2020
    #2
  3. Spur Support Services

    Spur Support Services UKBF Regular Free Member

    195 41
    RP have given some sound options.

    You could also separate the trades, perhaps having your computer repair work as self employed, which gives you more flexibility in recovering any home workshop costs.

    Your limited company could service your high end financial service industry consultancy work. This also has the benefit that it legally splits your activity reducing the risk of a VAT threshold breach, which is important to both your Financial Services customers and any individuals using your repair service.

    Re bank accounts look for something like Tide, which doesn't have monthly fees making multiple bank accounts not such an issue.

    However, don't forget to factor that certain costs may be duplicated under the above plan, such as insurances and accountancy, so weigh this up in any decision you make.

    Also, consider whether your IT project work is likely to get caught by IR35/Off Payroll rules. This would make the need for the consulting company completely obsolete. I am aware that some Financial Service entities already sought to move all contractors on to payroll over he last couple of years, but there still remains a large amount of uncertainty in this whole area and HMRC is still in consultation, with expectations of further revisions at the 11th hour within FA2021
     
    Posted: Dec 31, 2020 By: Spur Support Services Member since: Aug 21, 2020
    #3
  4. Katherine Ferona

    Katherine Ferona UKBF Newcomer Free Member

    2 0
    Hi, maybe you can share more about which country and what business you are intending to start? If you are flexible with the countries, Singapore is quite a good choice for new companies!

    One major plus point to start a business in Singapore is definitely the lower tax rates of 17% as compared to other countries.

    If you are unfamiliar with setting up 2 businesses, You can actually approach professionals who has experience in helping individual to set up their business. I have a friend who used to incorporation with the help of Paul Hype Page and had a pretty good experience.

    You can read up their website for more useful information to failitate your process.
     
    Posted: Feb 19, 2021 By: Katherine Ferona Member since: Jan 13, 2021
    #4