A limited company is a type of business structure that offers its owners a number of benefits, including limited liability, tax efficiency, and professional credibility.
- Limited Liability: One of the most significant benefits of forming a limited company is that it offers its owners limited liability. This means that the owners of a limited company are not personally liable for the debts or liabilities of the company. This protection can be very valuable in the event that the company goes into financial difficulty.
- Tax Efficiency: Limited companies are also taxed more favorably than other business structures, such as sole traders and partnerships. Limited companies pay corporation tax on their profits, which is currently set at 19%. Sole traders and partnerships, on the other hand, pay income tax on their profits, which can be as high as 45% for higher rate taxpayers.
- Professional Credibility: Forming a limited company can also help to improve the professional credibility of your business. Customers and clients are often more likely to do business with a limited company, as they perceive it to be a more established and reputable business.
How to Form a UK Limited Company
The process of forming a UK limited company is relatively simple and can be completed online. To form a limited company, you will need to:
- Choose a name for your company.
- Register your company with Companies House.
- Open a business bank account.
- Get an accountant.
- Get a business insurance policy.
- Once you have completed these steps, your limited company will be up and running.
Benefits of Forming a UK Limited Company
The benefits of forming a UK limited company include:
- Limited liability
- Tax efficiency
- Professional credibility
- Access to finance
- Increased opportunities for growth
If you are considering starting a business, forming a UK limited company is a great option. It offers a number of benefits that can help you to succeed in business.
Here are some additional benefits of forming a UK Limited company:
- Increased borrowing capacity: Lenders are more likely to lend money to limited companies, as they know that the owners' personal assets are not at risk.
- Ease of succession planning: It is relatively easy to transfer ownership of a limited company to another person or entity. This can be important for businesses that want to ensure that their business continues after they retire or sell it.
- Increased flexibility: Limited companies are more flexible than other business structures, as they can be adapted to meet the changing needs of the business.
If you are considering forming a UK limited company, CG Incorporations can ensure that your company is set up correctly and that you comply with all relevant laws, regulations and that your company is structured correctly for your requirements.
Published: 7/12/2023 5:23:29 AM