Financing a Plan B

[stek]

What about the independent objects clause aka the Cottman v Brougham clause?

[GB9]

A company CAN do widely different things IIRC, but there are reasons why you might not want to. Anyone?

Yes, you can do what you want, however it has to be accounted for appropriately. I had a similar idea and having cash in the business account I thought "save a bit of tax here". Unfortunately I would have had to effectively pay myself a dividend, pay tax and reinvest what was left. All of which made it unviable.

[d000hg]

A company CAN do widely different things IIRC, but there are reasons why you might not want to. Anyone?

[GB9]

However you do it, writing the losses of plan B against contracting income is a real benefit.

What I'm doing is running both through the same Ltd, BUT plan B would move to a new Ltd when it takes off.

Depends how different the line of work is e.g. if you set up an online bike retailer you couldn't offset losses of that against your contract income.

If you are a contract software developer then within your current company you are fairly constrained to doing software development. Taxes from any other line should be accounted for separately

[kingcook]

We all want to do that, but dont you find everything you think of has already been done?

Exactly!! I sometimes think that it'd be best (even in this world-wide malarkey) just to start something local, and expand on that.

Open to ideas as to what will work

[d000hg]

Looking at this seriously now now I have a larger warchest than I've ever had.

I have something in mind, but is it best to;

1. Invest within current limited, ie for additional revenue stream

2. Lump sum investment in new Ltd separate from Contracting Ltd. Group Accounting woes!

3. Or same but new enterprise as sole trader/partnership

I think 3, then 2 but not 1....

However you do it, writing the losses of plan B against contracting income is a real benefit.

What I'm doing is running both through the same Ltd, BUT plan B would move to a new Ltd when it takes off.

[northernladuk]

We all want to do that, but dont you find everything you think of has already been done?

+1 to this!!! Even some of the slightly more outlandish ideas you have once in awhile have someone all over it already. Wonder if it is a case of just jumping in with the throng and being better than them rather than finding a get rich quick scheme?

[escapeUK]

Also being a web dev im trying to setup up some websites in my spare time to hopefully make me my fortune (maybe wishful thinking)

We all want to do that, but dont you find everything you think of has already been done?

[chewie171]

i'm curious what are other contractors investing the money into / have a plan B with contracting market not being so good.

im thinking of getting a second house and letting it out.

Also being a web dev im trying to setup up some websites in my spare time to hopefully make me my fortune (maybe wishful thinking)

[Mose]

If you are expecting loss or intend to engineer it into a plan, a holding company arrangement can be very attractive with 51% ownership to lessen tax on the currently profitable area.

[stek]

Looking at this seriously now now I have a larger warchest than I've ever had.

I have something in mind, but is it best to;

1. Invest within current limited, ie for additional revenue stream

2. Lump sum investment in new Ltd separate from Contracting Ltd. Group Accounting woes!

3. Or same but new enterprise as sole trader/partnership

I think 3, then 2 but not 1....