START- UPS & COMPANY FORMATION
To put your business on a proper footing with HM Revenue & Customs (HMRC) and other authorities, you need to make sure that it has the right legal structure. It's worth thinking carefully about which structure best suits the way that you do business, as this will affect:
the tax and National Insurance that you pay
the records and accounts that you have to keep
your financial liability if the business runs into trouble
the ways your business can raise money
the way management decisions are made about the business
There are several structures to choose from, depending on your situation. This short guide will help you understand the differences between them.
If you are not sure which legal structure would best suit your business please contact us:
SELF-EMPLOYMENT: To be a sole trader, a partner, or a member of a limited liability partnership as an individual rather than a company, you must be self-employed and registered as such with HM Revenue & Customs (HMRC). This does not mean that you can't also do other work as an employee, but the work you do for your own business must be done on a self-employed basis.
SOLE TRADER: Being a sole trader is the simplest way to run a business - it does not involve paying any registration fees, keeping records and accounts is straightforward, and you get to keep all the profits. However, you are personally liable for any debts that your business runs up, which make this a risky option for a businesses. In a partnership, two or more people share the risks, costs and responsibilities of being in business. Each partner is self-employed and takes a share of the profits. Usually, each partner shares in the decision-making and is personally responsible for any debts that the business runs up.
PARTNERSHIP: Unlike a limited company, a partnership has no legal existence distinct from the partners themselves. If one of the partners resigns, dies or goes bankrupt, the partnership must be dissolved - although the business can still continue. A partnership is a relatively simple and flexible way for two or more people to own and run a business together. However, partners do not enjoy any protection if the business fails.
LIMITED LIABILITY PARTNERSHIP (LLP): A limited liability partnership is similar to an ordinary partnership - in that a number of individuals or limited companies share in the risks, costs, responsibilities and profits of the business. The difference is that liability is limited to the amount of money they have invested in the business and to any personal guarantees they have given to raise finance. This means that members have some protection if the business runs into trouble.
PRIVATE LIMITED COMPANY (LTD): Must be registered (incorporated) at Companies House. Must have at least one director who may also be shareholders. Directors must be at least 16 years of age. At least one director must be an individual, rather than a company. Private companies are not obliged to appoint a company secretary but if one is appointed this must be notified to Companies House.A “ Private Limited Company” is a limited company. The rights and obligations are the same to any limited companies in Europe.The minimum social capital has to be of GBP 100 sterlings and his value can be decided by a free choice for the partners. The social capital decided, it has not to be paid in. The property of the shares can be without exception of the director, a third person or English or foreign company. The Limited Company'social capital can be reduced to the 2% of the fixed capital. The Manager Director has the duty to manage and represent the company. He is the key person for the company decisions. A Limited Company can be established within 24 hours and it is completely operative.England has bilateral agreements of taxation with all the countries in ECU . A Limited Company can immediately run business activities also on the International markets.
PUBLIC LIMITED COMPANY (PLC): Must be registered (incorporated) at Companies House. Must have at least two director who may also be shareholders. Directors must be at least 16 years of age. At least one director must be an individual, rather than a company. Must have a qualified company secretary. Must have at least two shareholders and must have issued shares to the public to a value of at least £50,000 or the prescribed equivalent in euros before it can trade.
IRIDE GLOBAL has a network of Commercial Advisors, Commercial Lawyers, Chartered Accountants, Indipendent Banking Consultants, Indipendent Financial Advisors & Barrister/VAT Specialists to help you estabilish/manage your business in a proper legal & commercial manner.
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