New Business, Idea and no idea how to start?

[Deleted User]

:(Can you help me please, I am a novice.

I need your help. I have a new idea for a business that I think is much needed in my area.

I heard from people that a ltd company is the best way to go, butwhat is the difference? will I not be liable for any debts if all goes wrong? or why do people pick ltd companies and then go bust?

I want to set up as soon as possible, is the bank a great place to start?

What do you think of this e-how site it directed me to a site that sets up ltd companies including accounts and bank accounts?

Any help would be very very nice.

Horace

For start up advice try business link or your local chamber of commerce as they give free courses.

An accountant should be able to advise about whether or not you are ready too be a limited company or remain a sole trader. A limited company has to pay corporation tax, PAYE (because you would be an employee) and have to submit accounts to Companies House annually. The company is liable for any debts, however, you are still open to being sued personally if you don't pay the company's debts. Companies go bankrupt because of lack of cashflow - i.e. they provide goods/services to customers who then drag their heels when it comes to paying, if customers can't or won't pay then the company still has to pay its suppliers.

If you are a sole trader you are liable but one hopes that you wouldn't get yourself into such a mess. I know that I have managed to set up with no money behind me to fall back on and I refuse to owe people anything so I make sure all my bills are paid (both business and domestic) before I even contemplate feeding myself. I have to pay all my own tax and national insurance too. I know that I am not ready to become a limited company just yet.

Annisele

Depends very much what sort of business it is.

If you're going to be, say, a hairdresser working one day a week for a limited income, then there's probably very little advantage to going the limited route and you might as well be a sole trader. If you're going to be an IT contractor, you might find that your clients will only sign contracts with a limited company, so you have no choice but to go limited.

Do you need finance for your idea? If so, banks generally don't lend unless you can put money in yourself, and your sig unfortunately suggests that might be a problem.

[Deleted User]

Thanks guys

daisyf_2

also inland revenue do some courses on how to set yourself up to be self emplloyed etc etc