Boosting income as a limited company

Scunge

Hi.

I have been looking at the various ways to earn some income, as highlighted by the recent mailing. It all looks interesting, but I am a little confused as to how my personal circumstances would affect things. I did a search but nothing popped.

Basically, I have recently become a one-man limited company through which I aim to work at home, etc, rather than having a salaried position.

So the first question really is, is there any restriction to me registering on all these various apps and web sites as the company, and then receiving income into that rather than me personally (for those who don't know, a limited company is a separate legal entity from me as an individual, so if I registered as me, technically I reckon that wouldn't be business income).

Also, I know that if I earned this income as me, i.e. a self-employed person, I would get a £1000 allowance in each tax year, so is it a reasonable assumption that I could earn the first £1000 as that, then do any extra work in the year as the business?

Does anyone else do this; anything else to add?

Thanks for any replies to help me decide on this.

DoctorStrange

As you've said, you and your company are two separate legal entities but you can't take the personal sole trader allowance and use that for the company.

If you're running different businesses though (e.g. a sole trader in the decorating business and a limited company in financial services or something), you can use the £1000 allowance for the decorating side, but you can't take the first £1000 income from the financial services side under the sole trader allowance).

Out of interest, what is your company set up to do? Do you have an accountant?

DoctorStrange

Sorry, re-reading your post it sounds as though as you'd like to sign up with some online companies as both an individual as well as on a B2B contract via your ltd co.

I'm not sure you'll be able to claim the sole traders allowance if you sign up directly as you'd really be an employee if you did, which is why I believe these types of companies only use limited companies.

Scunge

DoctorStrange wrote: »

Out of interest, what is your company set up to do? Do you have an accountant?

Thanks for your replies.

The company isn't specifically set up for anything as yet, I am just in the lucky position of not having to work but wanted to have a go at having a small business. I figured that in time I'll decide in what, but originally envisaged that all income earned by whatever means would all be declared through the business. Then I read about that allowance and wondered if I could make use of it.

I don't have an accountant but see that this is quickly heading in that direction.

DoctorStrange wrote: »

Sorry, re-reading your post it sounds as though as you'd like to sign up with some online companies as both an individual as well as on a B2B contract via your ltd co.

Well perhaps not both at the same time with the same online income source, just for simplicity's sake; but certainly some sources using the ltd co (if they're likely to make more income rather than less), and some by me as an individual (for the ones which are likely to just provide a small income). Then I could use the £1000 allowance on the latter set.

soolin

Why have you chosen the limited company option ? it might be cheaper to do it all as a sole trader

Scunge

I liked the idea of protecting the rest of my finances in case I try this and it goes wrong. Limited liability an' all.

Mistral001

Many quite large successful businesses employing hundreds of people are sole trader businesses, so forming a Ltd Company is not always needed or indeed advantageous.

General_Grant

Scunge wrote: »

I liked the idea of protecting the rest of my finances in case I try this and it goes wrong. Limited liability an' all.

Have you got appropriate insurance in place?

Directors of limited companies can still be liable for some things - it isn't a get out of jail free card.