Want to set up a ltd company with one employee (for starters) my nephew whom is a class 1 driver.
I will be a director but do i need a secretary to set up the company?
Do i have to state what the company actually does as in manufacturing , sales etc etc and if so what would you say it does if its basically similar to an employment agency and can you change this at a later stage if the company wants to change to a different thing for example from supplying drivers to lets say a manufacturing role.
nedflanders:
Want to set up a ltd company with one employee (for starters) my nephew whom is a class 1 driver.
I will be a director but do i need a secretary to set up the company?
Do i have to state what the company actually does as in manufacturing , sales etc etc and if so what would you say it does if its basically similar to an employment agency and can you change this at a later stage if the company wants to change to a different thing for example from supplying drivers to lets say a manufacturing role.
Far as I know you don’t need a secretary. And as far as I know once you have set up a ltd company you can use it to do what ever you like. The only people you would maybe have to talk too or chance things with maybe any insurance that you have.
friend of mine has ltd and dose all kinds of things. you can even have diffrent front names to the real name thats reg at companys house/ like my mate has 3 shops all selling completely diffrent stuff all with diffrent shop names above the doors yet all fall under one reg ltd company and all of them useing the same bank account.
Thanks JRT thats info i was looking for as afraid i might set up a company and not do it right
From what i see you can set up online very cheaply where as if you use an accountant it costs a few hundred
nedflanders:
Thanks JRT thats info i was looking for as afraid i might set up a company and not do it right
From what i see you can set up online very cheaply where as if you use an accountant it costs a few hundred
An accountant may cost a few hundred but i bet they could save you a few thousand. Sometimes it’s beneficial to pay someone who knows all the ins and outs.
m1cks:
nedflanders:
Thanks JRT thats info i was looking for as afraid i might set up a company and not do it right
From what i see you can set up online very cheaply where as if you use an accountant it costs a few hundredAn accountant may cost a few hundred but i bet they could save you a few thousand. Sometimes it’s beneficial to pay someone who knows all the ins and outs.
^^ and maybe getting a secretary might not be a bad idea… she can at least spell your correspondence correctly.
m1cks:
nedflanders:
Thanks JRT thats info i was looking for as afraid i might set up a company and not do it right
From what i see you can set up online very cheaply where as if you use an accountant it costs a few hundredAn accountant may cost a few hundred but i bet they could save you a few thousand. Sometimes it’s beneficial to pay someone who knows all the ins and outs.
I def aggree with you there but for the inital stage of registering is pretty straight forward so only for yearly accounts is where accountant will make u savings
Also to find the right one is the problem so any suggestions preferably someone that will do a lot over emails thus saving time to go visit every time u want to know something as i live in central london.
fdm:
m1cks:
nedflanders:
Thanks JRT thats info i was looking for as afraid i might set up a company and not do it right
From what i see you can set up online very cheaply where as if you use an accountant it costs a few hundredAn accountant may cost a few hundred but i bet they could save you a few thousand. Sometimes it’s beneficial to pay someone who knows all the ins and outs.
^^ and maybe getting a secretary might not be a bad idea… she can at least spell your correspondence correctly.
maybe i am just tired but dont get this
BTW you can be the director and company secretary yourself.
It is dead easy to set up a limited company on line and should all be done very quickly at a cost of £15. You can be sole director — no company secretary required. That’s the easy bit, from then on things can get messy very quickly if you don’t have at least some idea of what to do.
When registering your company you will be asked to choose a SIC code which will describe the main activity of the company but this will not prevent you doing other stuff later.
I do not think that an accountant will save you much more than you could save yourself with the proviso that you do need to have a good idea what to do and what to claim for in the first place. On that basis it may be beneficial to have an accountant for the first couple of years at least. Also I have come across at least one agency that demands that you have an accountant before they will give you work.
Other agencies have different ideas as some require public liability insurance and others don’t.
To get the accountants fee down it is best if you do as much of the “accounts” as possible and there are lots of accounts packages, some free, to help you. Just chucking all your receipts in a shoe box means the accountant (or someone in his office) will have to spend time sorting it out which you will pay for.
HMRC run webinars and other things to help you. One very useful thing from HMRC, as you say you will be employing at least one person, is a free payroll software package that can cope with up to 9 employees and being supplied by HMRC it complies with all the RTI submissions that you would have to make. The only drawback is that it does not print payslips. You must register with HMRC as an employer if you employ people.
As you may not have a lot of purchases to reclaim VAT on it could be advantageous to register for the flat rate VAT scheme which could boost your profitability by approx 6%.
Before you can give certain benefits to yourself or to your employees it may be necessary to obtain a dispensation from HMRC. One of the biggest here is the often quoted £5/£10 daily meal allowance. To pay this with without further tax implications a dispensation is required. You could do this very easily by filling in an online form.
A separate bank account is not a legal requirement but is definitely preferable. Whether you want a dedicated business account will be up to you but some agencies will not pay into a non business account. I have the 5% TSB account under my name Joe Bloggs and my Ltd Company is Joe Bloggs Ltd and I have not had any problems. But it can be tricky if you mix your personal finances with your business finances in the same account.
It may be better to let your nephew be a director so as to pay him dividends which could save on national insurance contributions. If your nephew is just an employee then the scope for savings is reduced and normally you would have to pay NI at 13.8% on all his wages over £153 per week in addition to the 12% that he would have to pay. There is a scheme in place for small businesses to claim back up to £2,000 of employers Ni per year. So if you opted for that scheme you would escape approx £38 per week. The employees NI is not affected by this scheme.
Dividends can be paid on a weekly, monthly or yearly basis but they must be paid according to a set procedure which if deviated from could make the dividend illegal and you could be back to paying the NI charge.
A lot of the detail, payroll/benefits/expenses, can be dealt with by an accountant but I think it is best to be involved as much as possible because, after all, it is your company.
nedflanders:
fdm:
m1cks:
nedflanders:
Thanks JRT thats info i was looking for as afraid i might set up a company and not do it right
From what i see you can set up online very cheaply where as if you use an accountant it costs a few hundredAn accountant may cost a few hundred but i bet they could save you a few thousand. Sometimes it’s beneficial to pay someone who knows all the ins and outs.
^^ and maybe getting a secretary might not be a bad idea… she can at least spell your correspondence correctly.
maybe i am just tired but dont get this
Bless.
shake:
It is dead easy to set up a limited company on line and should all be done very quickly at a cost of £15. You can be sole director — no company secretary required. That’s the easy bit, from then on things can get messy very quickly if you don’t have at least some idea of what to do.When registering your company you will be asked to choose a SIC code which will describe the main activity of the company but this will not prevent you doing other stuff later.
I do not think that an accountant will save you much more than you could save yourself with the proviso that you do need to have a good idea what to do and what to claim for in the first place. On that basis it may be beneficial to have an accountant for the first couple of years at least. Also I have come across at least one agency that demands that you have an accountant before they will give you work.
Other agencies have different ideas as some require public liability insurance and others don’t.
To get the accountants fee down it is best if you do as much of the “accounts” as possible and there are lots of accounts packages, some free, to help you. Just chucking all your receipts in a shoe box means the accountant (or someone in his office) will have to spend time sorting it out which you will pay for.
HMRC run webinars and other things to help you. One very useful thing from HMRC, as you say you will be employing at least one person, is a free payroll software package that can cope with up to 9 employees and being supplied by HMRC it complies with all the RTI submissions that you would have to make. The only drawback is that it does not print payslips. You must register with HMRC as an employer if you employ people.
As you may not have a lot of purchases to reclaim VAT on it could be advantageous to register for the flat rate VAT scheme which could boost your profitability by approx 6%.
Before you can give certain benefits to yourself or to your employees it may be necessary to obtain a dispensation from HMRC. One of the biggest here is the often quoted £5/£10 daily meal allowance. To pay this with without further tax implications a dispensation is required. You could do this very easily by filling in an online form.
A separate bank account is not a legal requirement but is definitely preferable. Whether you want a dedicated business account will be up to you but some agencies will not pay into a non business account. I have p 5% ypir setting a company up hrt proper advice from an account account under my name Joe Bloggs and my Ltd Company is Joe Bloggs Ltd and I have not had any problems. But it can be tricky if you mix your personal finances with your business finances in the same account.
It may be better to let your nephew be a director so as to pay him dividends which could save on national insurance contributions. If your nephew is just an employee then the scope for savings is reduced and normally you would have to pay NI at 13.8% on all his wages over £153 per week in addition to the 12% that he would have to pay. There is a scheme in place for small businesses to claim back up to £2,000 of employers Ni per year. So if you opted for that scheme you would escape approx £38 per week. The employees NI is not affected by this scheme.
Dividends can be paid on a weekly, monthly or yearly basis but they must be paid according to a set procedure which if deviated from could make the dividend illegal and you could be back to paying the NI charge.
A lot of the detail, payroll/benefits/expenses, can be dealt with by an accountant but I think it is best to be involved as much as possible because, after all, it is your company.
Tapatalk is playing up
Right most of what shake has posted is correct but he missed the twist the employee.
You’ll need employers liability insurance and I recommend public liability. As your basicly asserting an agency up you’ll come under the agency and gangmasters regs too so get some professional advice before setting it up. You’ll be liable for his wages including holiday employers Ni most of q what can be claimed won’t apply to him. And it could affect your own tax possition adversly. If your employed so will your nephew be any better off than he is now
alix776:
Tapatalk is playing upRight most of what shake has posted is correct but he missed the twist the employee.
You’ll need employers liability insurance and I recommend public liability. As your basicly asserting an agency up you’ll come under the agency and gangmasters regs too so get some professional advice before setting it up. You’ll be liable for his wages including holiday employers Ni most of q what can be claimed won’t apply to him. And it could affect your own tax possition adversly. If your employed so will your nephew be any better off than he is now
I thought the same thing about the nephew. Because the only way for the OP to make any money is to take it from the nephew. At this early stage as the nephew is the only income source he would also be paying for all the “extras” like the insurances, accountants etc.
Personally unless your going direct with 4-5 drivers then its not a viable model. His nephew will be worse off working for other agencies as the rates won’t support the business
Unfortunately employers liability is a legal requirement for a ltd company even if you only use subbies. Ie if I was to sub courier work out as the vendor I have a duty of care to the subby. Or employee.
Great post shake. Makes a change to get facts not bs on this subject.
Dispensation for meal allowance, how did you get it?. I got a flat rejection from hmrc. As director and an employee cant be trusted to run the scheme properly, could get it for other employees but not myself…
Bit OT but just digging for a bit of info…
Thanks shake and everyone else
Shake ur help is most appreciated def has made things a lot clearer for me
calsdad:
Dispensation for meal allowance, how did you get it?. I got a flat rejection from hmrc. As director and an employee cant be trusted to run the scheme properly, could get it for other employees but not myself…
Did you apply in writing? Below is a link to the “application form??”
online.hmrc.gov.uk/shortforms/f … mrc.gov.uk
There are loads of items that you can request a dispensation for and also there is the bit about receipts and checking.
I just ticked No for receipts and No for independent checking. Still waiting but I expect a refusal.
If you could tick yes to at least one of these items it may be different but don’t forget that even if they refuse you can still claim the flat rate £2 meal allowance without dispensation.
hmrc.gov.uk/manuals/eimanual/eim66140.htm
Thinking more about this post, this forum may not be the best place for it.
The OP seems to want to set up a business that may be an employment agency or may be involved in manufacturing and as such he may be better suited asking on business forums or even a small business advisor attached to one of the high street banks.
Possibly it should be his nephew asking for advice on this forum.
Yes Shake.
Applied using the online facility. Flat No. Called for explanation, nice chap explained it’s to do with the validity of the checking system. It’s not independent if you do it on yourself,but is if you do it on another employee. Hence big companies have a office bod collecting reciepts for odd drivers here and there to prove the £10 is reasonable.
Basically he implied if i was a one man limited company I was getting enough anyway and shouldn’t push my luck. Keep meaning to have a better look at dispensations to see if there is any easy wins on there. Might have a look through it on me hols in Jan.
calsdad:
Yes Shake.Applied using the online facility. Flat No. Called for explanation, nice chap explained it’s to do with the validity of the checking system. It’s not independent if you do it on yourself,but is if you do it on another employee. Hence big companies have a office bod collecting reciepts for odd drivers here and there to prove the £10 is reasonable.
Basically he implied if i was a one man limited company I was getting enough anyway and shouldn’t push my luck. Keep meaning to have a better look at dispensations to see if there is any easy wins on there. Might have a look through it on me hols in Jan.
HMRC may take an accountant or bookkeeper supported by receipts as an independent check. See EIM30059