98% of those who
meet us become
long term clients
meet us become
long term clients
A Sole Trader is the simplest legal model for a business. It means that the business is owned by one person and therefore means that the owner can take all the profit, but also is solely responsible for any tax liabilities. A Sole Trader makes all the key decisions about the direction of the business, they are allowed to employ people, they often have less bureaucracy to deal with and guess what? Their accountancy bills are usually less than other business models.
A Limited Company is a legal entity which is separate from the people who own it and usually set it up. It means that as a separate entity it can enter into contracts and trade in business, it also means that the owners have limited personal liability for any debts incurred, to the value of their investment. A Limited Company has to be registered at Companies House and file regular, annual accounts.
A partnership is similar to a Sole Trader, except that the business is owned by more than one person. It does not have a separate legal status, therefore all the profits and debts are jointly owned by the partners. There are no limits to the number of partners that own the business, limited companies can be partners in their own right and when the partnership is dissolved, the business simply ceases to exist.
A Charity is a not for profit legal entity which is established to achieve a very specific objective or objectives. The main benefit is that a Charity receives specific tax exemptions, most notably; it does not pay ‘corporation tax’ on any surpluses made by the organisation. Charities are monitored and governed by the Charities Commission, they are managed by a board of Trustees and while they can raise funds through private donations, they cannot raise what is known as equity investment i.e. funds which entitle the owner to a financial stake or return.
These are just a simple annual statement of your income and expenditure and they tell you if you made a profit or not.
Most businesses whether they’re a sole trader, limited company, partnership or charity produce a set of annual accounts as they are a useful way to measure success and above all, help calculate your tax obligation accurately. These are documents which speak to external stakeholders like Companies House, HMRC and shareholders.
Some businesses have to produce annual accounts by law. In the case of limited companies these are known as Statutory Accounts, which would normally be sent to Companies House each year. These too are for external use, primarily HMRC and Companies House.
Management Accounts are for internal consumption. They provide business managers and owners with vital information about how the business is performing, whether it is profitable and how much money the business has to invest moving forward. Examples of Management Account Reports are budget statements, cash flow forecasts and monthly profit and loss statements.
ANNUAL TAX RETURN
Whether you are a Sole Trader, Limited Company or Partnership, you have to submit an Annual Tax Return to Her Majesties Revenue & Customs (HMRC). This Return calculates how much Income Tax or Corporation Tax you have to pay each year.
Managing both your personal and company tax affairs requires planning and specialist technical knowledge, often borne out of many years of experience. Our Tax Management Team work very hard to ensure you and your business receive the maximum tax allowances and efficiencies, while also making sure you stay within the law and do not receive an unexpected bill.
‘Nothing exists in a vacuum’. If you want your business to survive or even grow, we would always suggest that you take regular ‘time outs’ to think about where the opportunities are, how the business might maximise those opportunities and what you need to do to achieve success. Business strategy and planning are areas of work we can help you with, after all, we had to do it ourselves.
Get in Touch
01302 752 700
We have a great team of people who are ready to help you.