Limited Company Accounts
[1-2 Directors]
The all essential, pay monthly accounts package including 24-7 accounts access, monthly profit and tax report, personal account manager, dedicated accountant, business advisor and free cloud software.
Limited Company Accounts
[3-4 Directors]
The all essential, pay monthly accounts package including 24-7 accounts access, monthly profit and tax report, personal account manager, dedicated accountant, business advisor and free cloud software.
Sole Trader Accounts Package
The all essential, pay monthly accounts package including 24-7 accounts access, monthly profit and tax report, personal account manager, dedicated accountant, business advisor and free cloud software.
Partnership Accounts Package
[2 Partners]
The all essential, pay monthly accounts package including 24-7 accounts access, monthly profit and tax report, personal account manager, dedicated accountant, business advisor and free cloud software.
Accounts for Limited Companies
To be or not to be
The benefit of trading as a limited company has always been the limited liability given to the company's directors/officers and shareholders. As a sole trader (or other non-limited business), personal assets can be at risk in the event of a failure of the business, but this is not the case for a limited company.
A limited company pays corporation tax on company profits and Directors pay income tax.
The finances of a limited company are a separate legal entity from the personal finances of their owners and exist in their own right.
Benefits
There are a number of tax advantages for a limited company.
- Firstly, there is no Class 4 National Insurance to pay.
- A limited company pays Corporation Tax at 21% on its profits up to the level of £300,000, after deducting all expenses including directors remuneration. On annual profts of £30,000 this could potentially save up to £1673 in tax in comparison to trading as a sole trader.
- Often it is possible to reduce the Corporation Tax, with careful planning, by making dividend payments to its shareholders, and by the use of a Company Pension Scheme
Records and accounts
The recording keeping and accounting requirements are somewhat more stringent than that of a non incorporated company.
- Statutory accounts must be filed with Companies House in due time to avoid a late filing penalty.
- Accounts must be audited each year unless the company is exempt.
- HM Revenue and Customs require that each Director submits an annual self assessment tax return in addition to the Company tax return.
- You must keep records showing your business income and expenses for at least six years and ensure your accounting records are kept in the appropriate format, as failure to do so can result in unnecessary penalties.
Accounts packages for Limited Companies...
We offer a choice of two fully compliant Limited Company packages, depending on the size of your business. Each is designed to suit your individual business requirements.
Limited Company Account Package [1-2] Directors
Limited Company Account Package [3-4] Directors
Limited liability companies
Limited companies exist in their own right. This means the company's finances are separate from the personal finances of their owners.
Shareholders may be individuals or other companies. They are not responsible for the company's debts unless they have given guarantees (of a bank loan, for example). However, they may lose the money they have invested in the company if it fails.
The Companies Act 2006 makes a number of changes that will affect directors and shareholders of limited companies. You can read about the Companies Act 2006 on the Department for Business, Innovation & Skills (BIS) website - Opens in a new window.
Main types
- Private limited companies can have one or more members, eg shareholders. They cannot offer shares to the public.
- Public limited companies (plcs) must have at least two shareholders and must have issued shares to the public to a value of at least £50,000 before it can trade. View the guide to company formation on the Companies House website - Opens in a new window.
- Private unlimited companies - these are rare and usually created for specific reasons. It is recommended you take legal advice before creating one.
Set-up
- Must be registered (incorporated) at Companies House.
- Must have at least one director (two if it's a plc) who may also be shareholders. Directors must be at least 16 years of age. At least one director must be a person.
- Private companies are not obliged to appoint a company secretary but if one is appointed this must be notified to Companies House. Public limited companies must have a qualified company secretary.
Management and raising finance
- A director or board of directors make the management decisions.
- Finance comes from shareholders, loans and retained profits.
- Public limited companies can raise money by selling shares on the stock market, but private limited companies cannot.
Records and accounts
- Accounts must be filed with Companies House before the time allowed for filing those accounts to avoid a late filing penalty.
- Accounts must be audited each year unless the company is exempt.
- When you file your Annual Return for the first time a letter will be issued to the Registered Office containing the company's authentication code and instructions for use of Companies House web filing services. Please follow the instructions in the letter.
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