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rose_lotus

Limited company

4 posts in this topic

Could somebody explain what a limited company is all about?

Many thanks

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Why not try Google?

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I have a limited company under my name which I started for the locum work.

You can open a limited company if you are ordinary resident in the UK. You need at least two people in the company, one the Director and other the secretary. If your spuse is not working, it can give you a great tax advantage.

The whole idea of a limited company is that you get higher rates of locum pay as the agency does not have to pay for NI and pension. You also pay business rate of tax on the income which is 19%. But for that you really have to be a career locum, if you work in one place for a long time, IR considers you as employee and you are liable for higher 40% tax.

There are other advantages of a limited company. any expense on or because of company is vat free. so if you buy computers for company or stationary, they are vat free. you can claim the vat when filing the return. You can also claim vat on petrol for official use. If you are working outside your office, which you will be for locum, you can claim substistance and you also have tax free funds for entertaining your clients and money for christmas etc. the possibilities to save on tax are endless if you have a good accountant.

Let me know if you want more details and I can email you with any further information you may want.

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