When you start out in business, there are many choices you need to make. These are important decisions, and they should always be made with good business in mind. It’s important to form the right type of company for your needs, and by far the most popular and versatile option offered by Company Formation MadeSimple is the UK Limited Company.
This type of company has many characteristics that are advantageous for business – particularly to a new business. As a result, it’s little wonder that it is the most popular type of company to form.
Limited companies provide a flexible and reliable choice for a business owner, and some of the benefits should be explored when launching your business. If you can accurately determine whether a limited company is for you, then you’re more likely to have a healthy and successful company as you embark on your new business journey.
What are the benefits of a limited company?
Limited company formations are popular for a number of reasons, one of which is the benefits that a limited company provides a business. These include:
- Tax – One of the biggest advantages when aiming to set up a limited company is that you can save on the tax you pay. As a result, you may find that you can take home a higher proportion of your earnings.
- Liability – As a limited company, your liability is limited – this can potentially protect you from financial problems, with the liability being placed on your business as opposed to you personally as the owner. This benefit of a limited company is useful because it provides a layer of financial protection.
- Shareholders – You can issue shares with a limited company, meaning the transfer of ownership is simple and easy to do. This provides a good foundation for the initial stages of your startup and the stages beyond as you grow and expand.
One of the other advantages to a limited company is enhanced borrowing power. As a sole trader your borrowing is linked to you personally, whereas as a company you have a separate credit rating – this can be very valuable for a startup with a bright idea that needs funding.
What are the requirements of a limited company?
There are some requirements when setting up a limited company. However by using Company Formation MadeSimple all of the paperwork and registration is taken care of, meaning you can quickly set up a limited company and move on with your business.
Some of the more important official requirements of a limited company include:
- Registration with Companies House – You must pay a filing fee, included in all our company formation packages, with Companies House (the registrar of companies in the UK) to officially register your business.
- Approval from Companies House – This is a check to make sure your business name is available and appropriate. Company Formation MadeSimple is synced with Companies House so you will normally find out within 3 hours if your registration has been successful.
- Annual Returns – You must file an annual return with Companies House. This is one of the most important requirements, but it can be done quickly and easily through the annual return filing service offered by Company Formation MadeSimple.
It is extremely important to be aware of the requirements that a UK limited company has, but with a quick and simple formation service you can get started in just 4 simple steps – so they will not get in the way of your business.
The most common form of privately held company
The private limited company is the most common type of company in the UK. It remains a solid and stable choice with a great deal of flexibility. This means it can work for startups and larger businesses alike.
This gives you an advantage when starting out on a new venture, as the more established businesses in your particular field will likely have set up a limited company too.
With free business toolkits, fast-tracking for a Barclays Business bank account and a free accountancy and tax consultation there are so many reasons to choose a package and set up a limited company with Company Formation MadeSimple.
Did you find this useful? Make sure that you read the rest of our blogs on Company Formation MadeSimple, and specifically the ones relating to Limited Company formation, for more related news and info.
By Alex Novakovic at MadeSimple – Find Alex on Google+