- Get Professional Advice
Every business is different. An accountant (like HJ Accountants) can advise on the best structure based on your profits, growth plans, and personal circumstances.
- Incorporate with Companies House
You’ll need to register your company name, director(s), and a registered office address with Companies House. This can usually be done online in less than 24 hours.
- Register for Corporation Tax
Once registered, you must inform HMRC that your company is active. You’ll then receive deadlines for filing accounts and paying corporation tax (currently 19–25%, depending on your profits).
- Set Up a Business Bank Account
Limited companies are legally separate from you, so you must open a dedicated business bank account in the company’s name.
- Transfer Assets & Contracts
Move any business assets, contracts, or agreements into the company name. This may include vehicles, equipment, supplier arrangements, and even your website domain.
- Update Clients and Invoicing
All invoices, marketing material, and communications must now show your limited company name and company number. Don’t forget to notify customers and update platforms like LinkedIn and Google My Business.
- Start Drawing a Salary or Dividends
You’ll need to register your company for PAYE if you plan to pay yourself a salary. Most directors take a low salary plus dividends (paid out of profits), but it’s crucial to structure this correctly to stay tax efficient.
Key Considerations
- National Insurance: You’ll stop paying Class 2 and Class 4 NICs as a sole trader, but as a director, you may pay different rates through PAYE.
- VAT: If you were previously VAT-registered, you’ll need to re-register the limited company.
- Annual Filing: Expect to file annual accounts, confirmation statements, and corporation tax returns, your accountant can handle this for you.
Local Support, Tailored Advice
At HJ Accountants, we’ve helped countless North East business owners make the switch with confidence. From incorporating your company to setting up tax-efficient remuneration strategies, we’ll take care of the numbers so you can focus on growing your business.
Ready to take the next step in your business journey?
Contact HJ Accountants today for a free, no-obligation consultation.
Call us on 0191 251 7599 or get in touch online.