Why are Limited Companies still the most common choice for
contractors?
Despite the popularity of umbrella and PAYE companies, limited
companies are still the most common choice for contractors.
There are many advantages to limited companies such as the
limitation of liability - the fact that your personal finances
remain completely separated from your business finances so you will
never be personally liable for any of the limited company's
debts. Also, limited companies are able to determine the
level of salary and dividends you wish to take allowing you to have
some control over how much tax you pay. On the negative side
to limited companies, you have to be mindful of IR35 and take
professional advice as this could be detrimental to your
business. IR35 is a piece of legislation that affects small,
usually one man band limited companies and it has been enough to
force companies to close in the past so professional advice is a
must. Also if you are considering a limited company, you will
also need to consider your business finances and obtaining a good
accountant who knows and understands the industry you work in is
highly recommended. It really isn't worth trying to avoid
paying an accountant as their advice and knowledge is invaluable-
if you are taking your business seriously, you need a good
accountant.
If you are confused or maybe a little concerned about limited
companies and would like some advice about how to get started with
the least amount of worry and hassle, please pick up the phone and
speak to one of our friendly experts who will be happy to chat with
you. We offer accountancy services for limited companies,
limited company formation services and we also have our own
umbrella solution should you wish to consider it. Please
contact us today on 0117 904 7755 or at info@nasaconsulting.com.