Complicated (to me) structure, organisation and expenses of a new business.

redmel1621

Hey,
This might be long as I try to accurately explain the help and advice I am looking for. If anyone on here can advise on my situation, that would be great. Or alternatively point me in the right direction of 'who' I need to speak to... accountant, tax advisor, business advisor etc... 

I have three separate .names/brands' one of which is a registered business (LTD) and I am hoping to streamline them all into the one Ltd business. One of these will be easy to incorporate into the Ltd company as it is in part offering a service that the business will offer, so it is a sideways move. The other brand is the bit I am having difficulty with.

Brand/company ONE is an editing company. I have been offering editing services to indie authors for the past year. This is not registered and I have not earned above the threshold for taxes, as it has been very ad hoc/part time around my full time job.

Brand TWO is an author name. I have started to write and publish my own novels. I have an author name/branding, but this is not registered as a business as I wanted to publish under a 'publishing company' as this is a more professional way to publish as an indie author.

Brand/company THREE (you can probably guess) is the publishing company I have set up to publish my own novels through. This is registered as a Ltd company and is VAT registered with HMRC. I also have a business bank account for this company.

Now.. here is where I am getting confused. I wish to do two things. (and one of these has two parts lol)
1. I want to consolidate the services I offer through the editing business into the publishing business and expand the services I offer... This is fairly straightforward for one of the ways I wish to do so but I am not sure about the other way. The first way is to offer a self-publishing package to indie authors, so this would involve an agreed fee for a set of services, whether that is just editing, or editing and formatting etc etc.. Easy... I am paid by the author, I provide the service(s) done and dusted.
The second way is to offer a publishing service whereby I would provide the above services and also publish the authors work under my publishing company. I would then take a percentage of the profits, rather than an upfront fee (or as well as a smaller upfront fee).

2. I also want to run my author brand through the registered publishing company. This is for professionalism and tax purposes (I think). I want to be able to purchase covers, and pay for marketing through the publishing company. I also want to pay for cpd/training etc. I understand that I would be able to offset anything to do with publishing, for example a marketing course, or an editing course. Is what I am not sure about is whether I could do the same for training/cpd for myself as an author, like writing courses/books, which are not really 'publishing' related. However, they are for the author (myself) who will in the long run bring in more profit for the publishing company, by improving craft.

As you ca tell, I seem to have a tangled web of business/brands and I am not really sure how to structure it all so it is more streamlined and runs under one business for tax purposes, yet I need to market them separately.
I am also aware that i will need to almost treat them as two departments: publishing & writing. I want to make a business plan and state how I am planning how to distribute my time between the two departments. I can split my time 50/50 between them and then portion each 50% into work, marketing/advertising, finances, communication... So I can become more organised and more productive.

Sorry that was so long. If anyone has any advice at all, I would be extremely grateful. Even if you say that it is far too confusing and I need to seek help from a 'in person' business advisor...

tacpot12

Having read and understood your aims, I am inclined to think that you should keep all your 'services' that you offer to other people under the one registered Publishing company, but keep your own writing outside of the company. You (the writer) would be a customer of your Publishing company, and would receive the income from your publications as a sole-trader/self-employed writer. You can deduct the cost of the services that your Publishing company charge you.

I agree you need a business plan as you are effectively trying to do two things at once, so making a plan as to how much time you will write vs. how much time you will provide services is going to be essential. The Publishing work really has to come first, as you are charging people to do their work, but if you personally are paying a commercial rate for the work, your publications should get the same level of service that other paying customers are receiving when you have delivered it to 'your publisher'.

I don't think you have two brands within your service offerings, but you do have two different types of contracts or engagement that you want to offer. You could keep these very separate, and have a branding for each type of contract/engagement and you could issue invoices for one of the 'brands' under a Trading Name. Your Limited business can trade under two names; e.g. XYZ Editing and XYZ Publishing Ltd. Your bank will allow you to have two current accounts; one in the name of XYZ Publishing Ltd. and another in the name of XYZ Publishing Ltd. t/a XYZ Editing.  This means that you can issue invoices as XYZ Editing and if a customer writes a cheque to XYZ Editing, you can pay it into the account called XYZ Publishing Ltd. t/a XYZ Editing.   However, I don't think you need to go this far; I don't think that the effort to do so will be rewarded. I think it will be sufficient if the Publishing company makes it clear that it offers two very different engagement models and authors are welcome to chose the one that suits them best, but the cheques are always made payable to XYZ Publishing Ltd. 

Good luck with your enterprise and your writing.  

Mistral001

You say that you have three different brand/names of which only one is a Ltd company.  What exactly are the status of the two brands/names that are not connected to the Ltd Company?  Are you doing any trading using the brands or are they just brands that are sitting there  with say a logo and a website, but you have not offered any services under them yet? 

    

redmel1621

tacpot12 said:

Having read and understood your aims, I am inclined to think that you should keep all your 'services' that you offer to other people under the one registered Publishing company, but keep your own writing outside of the company. You (the writer) would be a customer of your Publishing company, and would receive the income from your publications as a sole-trader/self-employed writer. You can deduct the cost of the services that your Publishing company charge you.

I agree you need a business plan as you are effectively trying to do two things at once, so making a plan as to how much time you will write vs. how much time you will provide services is going to be essential. The Publishing work really has to come first, as you are charging people to do their work, but if you personally are paying a commercial rate for the work, your publications should get the same level of service that other paying customers are receiving when you have delivered it to 'your publisher'.

I don't think you have two brands within your service offerings, but you do have two different types of contracts or engagement that you want to offer. You could keep these very separate, and have a branding for each type of contract/engagement and you could issue invoices for one of the 'brands' under a Trading Name. Your Limited business can trade under two names; e.g. XYZ Editing and XYZ Publishing Ltd. Your bank will allow you to have two current accounts; one in the name of XYZ Publishing Ltd. and another in the name of XYZ Publishing Ltd. t/a XYZ Editing.  This means that you can issue invoices as XYZ Editing and if a customer writes a cheque to XYZ Editing, you can pay it into the account called XYZ Publishing Ltd. t/a XYZ Editing.   However, I don't think you need to go this far; I don't think that the effort to do so will be rewarded. I think it will be sufficient if the Publishing company makes it clear that it offers two very different engagement models and authors are welcome to chose the one that suits them best, but the cheques are always made payable to XYZ Publishing Ltd. 

Good luck with your enterprise and your writing.

Thank you for your reply. 

What you have suggested in terms of keeping the writing outside of the publishing company, is one of the thoughts I have also had. I am trying to avoid having to do two lots of financial tracking and tax returns, which I would have to do if I ran the author side as a sole trader... But I can see how this would probably be the most simplified way of doing things. Any costs or training/cpd for the author, in terms of improving craft, would then simply be applied to the sole trader author business, and any training costs in term of editing/publishing, would be applied to the publishing company. 

I would prefer to have it all under one company, but I fear I am making things more complicated than they need to be.

If I kept it separate, I would basically pay the publishing company for its services. So the income into the publishing company would be via the fees... That means that all income earned from sales of the books, would come to the author directly.  This is where it seems to get a little confusing.

I definitely need a business plan. I feel that initially my main income would come from the publishing side (clients) but eventually, I am anticipating the income from the writing side to increase, and overtake, the publishing side. Once this happens and I find that it is more profitable to write than to offer services for other authors, I will reassess the amount of time spent on each business.

Thanks again for the reply and for the good wishes.