What are the options when you set up a company in the UK?

When you set up a company you will have to make a decision more or less straight away: should I set up a limited company?

The simplest business set up allows you to take all the business decisions and take all the risks and rewards yourself.

But when you are setting up a business, this simple structure may not be appropriate.  What about other people owning and managing your business? Do you want to limit your risks and liabilities in the business set up? Do you want to be able to spread the ownership and increase the investors either when set up a company or in the future?

So lets have a look at the main advantages of three of the most popular ways in which people set up a business:

Set  up a Sole Proprietorship
  • Simple and inexpensive to create and operate
  • Profit or loss is reported in the owner’s personal tax return
  • Owner is personally liable for business debts
  • Life of the business is restricted to the life of the owner
  • Limited potential for value creation
Set up a General Partnership
  • Simple and inexpensive to create and operate
  • Partners’ share of the profit or loss reported in personal tax returns
  • Potential for some value creation
  • Partners personally liable for business debts
  • The business is dissolved when a partner dies
  • Only partners can raise outside capital
Set up a Company which is Limited
  • Owners have limited personal liability of business debts
  • Some benefits (such as pensions) can be deducted as a business expense
  • Owners can share out the profit and could end paying less overall
  • Access to full range of outside capital
  • Business can live on after founder’s death
  • Potential for value creation
  • Separate taxable entity
  • More expensive
  • Owners must met legal requirements for stock registration, account filing and paperwork

So if you decide that the right business format for your enterprise is to setting up a limited company, then the process is made easy by using the services of Brookstand. We will manage setting up a company online for you. Just use the user friendly company setup service we have created to get your limited company set up and ensure you are also registered with HMRC. This means you meet both your Companies House and Revenue and Customs requirements.

If you want more information, please leave a comment below and we will get back to you.

However, if you are ready to take the next step, just follow this link and we will assist in taking you through the process to set up a company.