Advantages

• Limited liability to the business debts, not personally liable for business debts
  
• Often perceived more stable than a sole trader or partnership
  
• Potential additional finance by selling shares in the business
  
• Has more credibility
• Easier to raise large sums of money

Contact a solicitor or accountant for advice

• Formalities involved in setting up
• Can cost £85 - £135 to set up
• Required to produce annual accounts which must be audited if the turnover for a financail year exceeds £1m
• More complex rules and regulations
• National Insurance contributions are potentially higher
• Filing requirements with strict time limits must be adhered to

• Must register at Companies House
• Can buy an 'off-the-shelf' company
• Must have at least two people: one director and a company secretary
• Company must file certain documents with the Registrar of Companies for registering as a private company

Contact companies house on 0870 333 3636

Can purchase 'off-the-shelf' limited companies

• Can trade under registered name or use a different business name
• Check if the business name is legally acceptable (see 'Choosing a business name')
• Can protect business name by registering it as a trademark
• Name must be displayed on business stationery including place of registration, registered number and the words, 'ltd' or 'limited'

• Each member must be registered as self-employed with Inland Revenue
• You need to inform the local Tax Office and your local Job Centre where necessary

Newly Self-Employed Helpline 08459 15 45 15 8am - 8pm, 7 days a week

To speak to someone in Welsh call 08457 660 830

Minicom users: 08459 153 296

• Directors are treated as employees and must pay income tac on their earnings as well as Class 1 National Insurance contributions (NICs)
• Company must pay NICs on behalf of its employees
• Eligible to pay corporation tax on profits made

• You must register if your turnover is £54,000 or more in a 12 month period

Custom & Excise: 0845 010 9000

• As a legal entity, it can take on employees