Second company

[acrobat]

Hi all,
I was hoping someone out there may have some advice for me on my ltd company.

I have been contracting now for 18 months advising companies on how to effectively use the internet.
During my time I have noticed my clients like real life examples, rather than just general statements. To help in this area I decided to launch an online shop, where I could use some of the techniques I talk about and show my clients. This has shown some good returns with repeat work etc. Plus, to be honest, it’s a great way of investing the profits of my company in a way that hopefully will give me a second source of income.

My problem is, my accountant has now decided they won’t support the shop as part of my company and have stated I have to run it as a sole trader. In the first year it is going to cost me £15k-£20k to get going which I just don’t have in a personal bank account (and I have already spent out of my company account).
Is there options like funding a separate company with the profits of my current one? Or another option.

I am of course looking into moving to another accountant, but worried this is going to become a common statement from them.

Any advice or thoughts are greatly appreciated!

[contractoralan]

Hi all,
I was hoping someone out there may have some advice for me on my ltd company.

I have been contracting now for 18 months advising companies on how to effectively use the internet.
During my time I have noticed my clients like real life examples, rather than just general statements. To help in this area I decided to launch an online shop, where I could use some of the techniques I talk about and show my clients. This has shown some good returns with repeat work etc. Plus, to be honest, it’s a great way of investing the profits of my company in a way that hopefully will give me a second source of income.

My problem is, my accountant has now decided they won’t support the shop as part of my company and have stated I have to run it as a sole trader. In the first year it is going to cost me £15k-£20k to get going which I just don’t have in a personal bank account (and I have already spent out of my company account).
Is there options like funding a separate company with the profits of my current one? Or another option.

I am of course looking into moving to another accountant, but worried this is going to become a common statement from them.

Any advice or thoughts are greatly appreciated!

Did you ask your accountant why they say so?

Remember, it is your company and you make the decisions. They provide a service and if they can't provide the service you want, fire them.

Well, you should take guidance and suggestions on matters beyond your grasp(laws, regulations etc), but they should not be calling the shots.("has now decided","have stated")



Assuming they are right and you want to do as self-employed, then the simplest way is to take a dividend and pay for your self-employment. otherwise, you can take a directors loan from the company. if the amount of loan is more than 5K, you will pay NI and tax on the amount. You can claim this amount back from HMRC when you repay the loan.

[craig1]

If you really need a second company, just make it a wholly owned subsidiary of the first and provide a long-term loan to the new company from the first. Set up group VAT, etc to simplify the whole thing.

[Craig@Clarity]

Hi all,
I have been contracting now for 18 months advising companies on how to effectively use the internet.
During my time I have noticed my clients like real life examples, rather than just general statements. To help in this area I decided to launch an online shop, where I could use some of the techniques I talk about and show my clients. This has shown some good returns with repeat work etc. Plus, to be honest, it’s a great way of investing the profits of my company in a way that hopefully will give me a second source of income.

My problem is, my accountant has now decided they won’t support the shop as part of my company and have stated I have to run it as a sole trader. In the first year it is going to cost me £15k-£20k to get going which I just don’t have in a personal bank account (and I have already spent out of my company account).

To me this sounds like you're opening up your business to offer online training and marketing to further your company's consultancy business. I cannot see why you can't spend on developing this side of the business and the offering of online techniques through your existing business. Is your accountant confused or misunderstood that perhaps it's not a physical shop like a newsagents selling sweets etc?

If they thought it was an actual shop then perhaps I can understand the advice on setting up a sole trader business but what you have posted, to me seems like a feasible option to put it through your current company.

[acrobat]

Hi all,

Thanks for your comments and advice. I did further digging with the accountants. Even though I made it clear that this site was part of my company before I moved to them they now feel their experience is not best placed to support me unless I change how I do it. (i.e. sole trader)

I have refused and I am now in wranglings to get a refund as they have actually done nothing, but charged me for several months. And I am off to get an accountant who actually listens to what I need!

[lje]

Also, if you started running your online shop separately from your limited co then you would owe it money. You'd need to buy the domain and pay for work done to set it up. You can't just take it.