Updated: Aug 30
How should I review my IR35 status as a limited company director and how would I notify HMRC?
You’d need a professional to assess your particular situation, Angle Accountants can help assess the risk of your contact being inside of IR35. Request a call back and a friendly accountant will call to discuss this in detail and give you an tailored estimation.
Is there a limit of time beyond which expenses cannot be paid? And is it a legal requirement to have all receipts?
You need to have all your receipts to be able to claim. It’s best practice to claim the expenses when completing the company accounts each year. However, you can amend accounts and corporation tax returns.
For Corporation Tax returns there is a time limit of four years from the end of the Corporation Tax accounting period to which the claim is related.
Do I have to store my receipts in the cupboard or can I just store them electronically ?
Storing receipts in a cupboard or electronically are both okay, but you must keep them for at least six years in case of an audit.
Does it make sense to keep personal and Corporation Tax aside in Business Bank Savings Account?
Yes it’s a good idea to keep Personal and Corporation Tax aside in a Business Savings Account. When you take money out of a business account there are automatically tax consequences, so keeping money in your business can help reduce your tax exposure.
What are the advantages of trading as a limited company?
Perhaps the most attractive benefit of trading as a limited company is the aspect of limited liability. Essentially this protects the personal assets of the officers should the company run into financial difficulties.
Many of the costs and administrative requirements associated with running a limited company are now not much more than those of a sole trader or partnership. Limited companies also instil added confidence in suppliers and creditors; many large organisations will only conduct business with limited companies.
Finally, the ownership of a limited company can easily be divided up through the sale of shares. The shares can be further used as a means of generating capital.
Who can set up a limited company?
Any individual of any nationality may register a limited company subject to a few conditions:They are not an undischarged bankrupt. They have not been restrained by court order. They are not subject to UK government restrictions
I don't live in the United Kingdom, can I still set up a new company?
Yes. The officers of a company may be resident outside the UK. The registered office address of the company must be situated in England, Wales, Scotland or Northern Ireland
What information do I need to set up a limited company?
To set up a limited company you will need the following information:
A unique name for your Company
A Registered Office address
At least one Director willing to accept the duties and the responsibilities that go with the post
At least one Shareholder willing to buy a single £1 share in the company. They can also be a director or secretary.
One Secretary (optional)
Key information for each director, secretary and shareholder: town of birth, eye colour and Mothers maiden name.
Credit card details to make payment
What is a Registered Office?
The registered office is the official address where all statutory documents from Companies House will be sent. This address will appear on the public records. A PO Box can be used provided the full address is given, including the postcode, and it is validated by the Royal Mail.
Can anyone be a company director?
Under the Companies Act 2006, every company has to have at least one director who is a natural person (or individual). In other words they cannot all be 'corporate directors'. Since 1 October 2008, the minimum age for a director is 16 years old.
What is the difference between shareholders and directors?
The directors are responsible for the day to day running of the company and ensuring it meets its responsibilities and deadlines. The shareholders own the company and have the right to vote on many issues. The extent of ownership and level of voting rights are based on the percentage of issued shares they own. An individual can be both a director and shareholder of a company.
What is Companies House?
Companies House is the Government agency responsible for registering all limited companies in the UK. It is also responsible for storing corporate information on all registered UK companies.
What is a Certificate of Incorporation?
This is an official certificate issued by the registrar on successful incorporation of a limited company. The certificate states the company number, name and date of incorporation.
What kind of accounts and records must a company maintain?
All companies are required by law to keep a full record of income, expenditure, assets, and liabilities. These records must be kept safe as they will assist you in attending to your duty of returning the companies annual accounts.
Do I need to return any documents annually?
Yes, you must provide a number of documents following your 'Accounting Reference Date' (ARD). This date is usually the last day of the month your company was incorporated and occurs each year; it is the date that your financial year ends where the accounts are to be made up to. You have 10 months from your ARD to return the following documentation to Companies House:
A profit and loss account (or income and expenditure account if the company is not trading for profit)
A balance sheet signed by a director
An auditors report signed by the auditor (if appropriate)
A directors report signed by a director or the secretary of the company
Notes to the accounts
Group accounts (When necessary)
Where eligible, medium-sized, small, very small and dormant companies may prepare and file 'abbreviated accounts'. Small companies (with a turnover of less than £5.6 million [£250,000 for companies that are charities] and assets of less than £2.8 million) can also claim exemption from audit.
Do I have to register for VAT?
As a limited company you are legally obliged by HM Customs & Excise to pay VAT if the company's taxable annual turnover exceeds the current threshold of £70,000, or you believe that it will exceed this limit in the next 30 days. Remember, not all products and services are subject to VAT and in some cases different rates may apply.
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