Setting up a limited co

[Soled73]

I've had a question from a friend, but I'm not sure of the best advice to give him.

He wants to move into contracting next year, around March time. His q was "can he setup a limited company in advance, and just have it sitting there?"

Personally I'm not exactly sure of the benefits of this, but he's a pretty "structured" person, so he wants to get all things in place before his 1st contract.

I've told him that it only takes a few days to set things up, but he wants to do it in advance.

[RichardCranium]

Your friend's 1st year trading figures will look poor should he be asked to provide "x years accounts" for any reason in the future. Although that will be easily explained away.

[DaveB]

I've had a question from a friend, but I'm not sure of the best advice to give him.

He wants to move into contracting next year, around March time. His q was "can he setup a limited company in advance, and just have it sitting there?"

Personally I'm not exactly sure of the benefits of this, but he's a pretty "structured" person, so he wants to get all things in place before his 1st contract.

I've told him that it only takes a few days to set things up, but he wants to do it in advance.

Yes he can. He can also register for VAT. Down side is that the clock starts ticking on the 1% VAT discount for the first year from the date of registration.

[Fred Bloggs]

Yes he can. He can also register for VAT. Down side is that the clock starts ticking on the 1% VAT discount for the first year from the date of registration.

Simple, register for the FRS in the 2nd year.

[kaiser78]

Set up the business bank account at the same time so your friend is ready to go when the money starts rolling in.

[Alan @ BroomeAffinity]

Yes he can. He can also register for VAT. Down side is that the clock starts ticking on the 1% VAT discount for the first year from the date of registration.

Registering for VAT is all but impossible if you do not have a date for starting trading.

[Sally BFCA]

Registering for VAT is all but impossible if you do not have a date for starting trading.

True! They will also have to file quarterly returns. Technically the PAYE will have the same problem, no date to 'employ' the director from.

Bearing in mind that these registrations have no effect on whether invoices can be raised and payments received, it would be simpler to apply for them when a contract start date is known.