Buying shares/property through my LTD

[cannon999]

It has been mentioned that it is best to set up a second company for this. But that seems like.. well extra paperwork. I could add another SIC code and purchase investments through the contracting LTD.

What are the dangers of doing so? I don't plan to get into big mortgages or take on big risks with the investments. Also I don't really see myself claiming ER relief as I wouldn't want to stop contracting any time soon.

[Maslins]

You've mentioned some of the downsides.

Another risk (you may consider very low risk) of putting your high value investments in the same entity as your trading business is risk of negligence/similar claims. Hypothetically you make an absolute howler in your contracting work. The client lodges a high value claim against your company for damages. Perhaps for some reason your insurance doesn't cover it. If you've got £millions of value of assets in the company, they're all at risk. If on the other hand you'd kept the trading company's assets fairly low, with your real wealth held elsewhere, your valuable assets are safe from this.

There's also just the tidiness perspective. For some people it feels cleaner to have all your trading in one entity, and all your investments in another, rather than a hotch potch of both muddled together.

[northernladuk]

It's also been mentioned not to do any of those through a company, even by Maslins. Is there any reason you want to go down this route despite it being generally advised against?

I'm sure the raft of posters that have shut their company recently didn't think they'd be doing so either so I believe having a strategy based only on what you want rather than based on the real possibilities is really flawed.

[BABABlackSheep]

It's also been mentioned not to do any of those through a company, even by Maslins. Is there any reason you want to go down this route despite it being generally advised against?

I'm sure the raft of posters that have shut their company recently didn't think they'd be doing so either so I believe having a strategy based only on what you want rather than based on the real possibilities is really flawed.

What he said.

You are changing the primary purpose of your company which I assume is classed as an IT Consultancy.

My accountant shot it down when I mentioned it years ago.

[simes]

I am not sure you can add a SIC code that runs contrary to the one that is of the main thrust of your LtdCo.

And while I agree that a second company seems solely to add secondary costs, what may in time encourage your decision is that mortgage providers seem now to want to lend only to LtdCos with the relevant SIC codes. It may be a strategy out of your hands...

[cannon999]

Thank you for your replies. Sounds like the route is clear - a second company. Is there any particular disadvantages to going via class B shares rather than loaning the money to the investment company?

[Lance]

Thank you for your replies. Sounds like the route is clear - a second company. Is there any particular disadvantages to going via class B shares rather than loaning the money to the investment company?

What do you mean by class b shares?

You know that the class letter is arbitrary don’t you?
Shares are shares. If there’s only one class of shares then they denote ownership.

What are you trying to achieve?

[NowPermOutsideUK]

Buying property now is foolish

Check chimpmaster and my posts on this subject and you will see that taking money out of business A is the best way to go rather than changing sic code because of mvl available to you

What Maslin said is true but is not close to the tax position you will find yourself in later down the road

[ChimpMaster]

Buying property now is foolish

Check chimpmaster and my posts on this subject and you will see that taking money out of business A is the best way to go rather than changing sic code be wise of mvl available to you

What Muslims said is true but is not close to the tax position you will find yourself in later down the road

[northernladuk]

What Muslims said is true but is not close to the tax position you will find yourself in later down the road

Dats racist