Limited Companies Guide
Starting a new Limited Company?
Setting up a Limited Company for a new business venture, incorporation of an existing Sole Trader, or if you’re a Contractor, starting a Limited Company can bring plenty of benefits. We have setup a quick guide below to help those setting up a new Limited Company. The guide is written by our experienced Chartered Accountants to provide a high-level guide focusing on key areas to consider when setting up new Limited Companies.
1. Form a New Company
Creating a new Company is probably the easiest part. Fusion Accountants provide a fully comprehensive service in creating new Company Formations.
You must also choose a suitable name for the company that is compliant. There are number of rules on choosing names, such as it cannot be too similar to another company or contain sensitive words or expressions that may suggest a connection with government or local authorities, unless you get permission.
You also need to think about the type of company and it structure that you would like to set up, i.e. the Shareholders, Directors, Secretaries etc. Again, if this is the first time you are doing this or not too familiar on incorporating new companies, then you should seek qualified professional advice.
2. Setup a new Business Bank Account
Since a Limited Companies is a separate legal entity, it must have a separate business bank account. Setting up a business bank account is not much different
to setting up a personal bank account, you need to provide identification and pass relevant bank checks and you should be able to get a bank account opened in no time.
Fusion Accountants have partnered with number of bank to help ease this process. The important thing here is to choose a bank that meets your needs without charging you an arm and a leg. Given the current competition in the market nowadays, there is plenty to choose from. We strongly recommend that you do not mingle your personal account transactions with any business related transactions. This will help a smoother record keeping and reduce the risk of error.
3. Get Insured Adequately
Before you start trading you should get insured. There are 5 main types of insurances that you should think about. If you are a Contractor or Freelancer then life is easier as Fusion Accountants have partnered up with one of the biggest Contractor Insurance providers ‘Kingbridge Insruance’. They provide a competitive package combining all 5 key insurances and as a Fusion Accountants client you will get a 10% discount. If you are a business then again Fusion Accountants can work with you to get a great insurance package with one of our other insurance partners.
4. Get Registered with HMRC
If you aren’t registered with an accountant by this stage, then you should be considering this, as the next few compliance stages, though can be handled by yourself, should be managed by your accountant.
You should consult with your accountant to determine what if any registrations are required with HMRC and whether they are compulsory or voluntary to gain tax benefit.
If you are going to be employing staff then you must register for PAYE and when you run your employee payroll must comply with Real Time Information (RTI) submissions.
Similar you may be required or even voluntary want to register for VAT.
5. Start your business accounting
You are almost ready to go, being an accountant for number of years we have noticed those that pay that little bit more attention in getting themselves organised before they start trading fully tend to have far less issues later.
So, speak to your accountants, choose a suitable accounting software and make sure your invoices are compliant with relevant information. This will help you make those crucial business decisions and help you stay on top of your business by letting you know how your business is doing, how your cashflow is (very important), who you need to pay and who owes you money etc.See our Online Accounting Software section
6. Start Trading
You are ready for business. Use the accounting software to keep on top of what’s coming in, going out, who’s owed what etc.
Remember your time should now be focused around growing and managing the business and not tied up with the accounting and compliance admin.
7. More Compliance?
Don’t worry, this should all be managed if you have a good accountant in place. As Limited Companies are a separate legal entity they must provide their own set of annual accounts in statutory format.
Monthly PAYE RTI must also be submitted if you have employees, if you are VAT registered then you must VAT returns, Annual returns submitted to companies house and Corporation Tax (CT600) submitted.
Though these all should be managed by your accountant, you still need to make tax payments on time for VAT, PAYE, Corporation Tax etc.View our Accounting Packages
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