Setting up a Limited Company information
There are benefits of setting up a limited company, a limited company is a separate legal entity and own assets and have liabilities. A company can sue and be sued whilst a sole trader can be liable for debts and be sued for it’s personal assets to reclaim the costs. Companies are run and managed by directors, business decisions are be made on behalf of the company and the owners are liable for the share of investment they have made in the company. A minimum of one director is required for a limited liability company, the responsibility of the director is to manage the company.
A limited liability company requires more legal supervision, whilst a sole trader does not have this restriction. Profits and losses are a part of the company and companies can continue in the case of death. Limited companies have to pay corporation tax at the end of the tax year.
One of the main benefits of limited companies is that the financial risk of the amount invested into the company is restricted. But if the company fails and the directors role
has not been conducted appropriately, then liability may passed on for the debts and can be disqualified and removed as a director. This may affect your positions in future if
you decide to become a director in another company.
GM professional accountants can help you register your new company.
Registration of a new company requirements
- Memorandum of association
- An Application for registration
- A statement of compliance
- The appropriate fee
For more information on Setting up a Limited Company, contact GM professional Accountants