Hi all,
Time to start asking some questions I think for those of you with a little patience!
I'm looking at starting a new business to supply boats on the local canal with coal, diesel, firewood and other products and services. Initially I intend to make deliveries using my own van, as most of the mooring areas are easily accessible by road. In the future I am looking at buying a working boat to trade from, at which point a number of additional services could be added to my offering, and deliveries to some extent would be made easier as it would simply be a case of tying alongside the customer and transferring goods across.
There are a number of businesses operating like this around the canal system, and the general opinion seems to be that a living can be made, though as the title of the thread says, this is more of a lifestyle business providing quality of life, rather than quantity of money! Realistically, I don't NEED to make an awful lot of money to get by. I am also looking at helping to keep the canal business afloat (sorry - couldn't resist!) by selling firewood and coal to local householders. The firewood market has gone silly in the past few years and demand is outstripping supply in many areas. Basically - if I can put £300 a week into my pocket, then that is enough as long as I've paid my suppliers and all the rest of it. I'm not averse to hard work or bad weather, and have no romantic illusions about life on the canal all being plain sailing as it were. Days like today for instance you probably wouldn't put the dog out - but that's not really an issue for me.
I do have a few initial questions though if anyone can help out?
Form of business. My wife thinks that a limited company is the way to go. Reasons being that I will be wanting to deal with some fairly big suppliers, especially for the diesel and they may shy away from a guy on his own wanting large quantities of red diesel! To some extent there is the customer trust side of things, though I have a pretty good relationship with many of my customers already due to working on the canal for British Waterways in my last job - which ended yesterday! There may be a requirement for finance if I buy this boat and she thinks it's better to be safe than sorry in the case of everything going wrong. We don't want to be in the position of losing our house or anything! I also understand that a limited company can make higher profits before having to pay tax than a sole trader? Any thoughts? My wife has done VAT returns and so on for a business we had ourselves a while back, and she's now doing the accounts for a local building company whilst studying accountancy at college. She doesn't think she will be able to do the accounts in full for a limited company just yet though. I'm guessing that there is a lot more to do than with a sole trader operation, and she just won't have covered some of the stuff involved yet.
VAT. As I will be supplying products like red diesel which are rebated fuels, I will need to collect and make regular returns of duty to HMRC, and I'm guessing that VAT registration will be essential, although I am not likely to be anywhere near the limit for compulsory registration as far as trading goes. There is a further complication in that red diesel for boat propulsion (as opposed to heating/cooking/electricity generation) attracts a higher rate of duty now than it used to do. Basically the concession allowing boaters to use red without additional duty was ended fairly recently, and now they are supposed (required actually) to make a declaration to the fuel supplier detailing the use they intend to make of the fuel supplied - ie 60% propulsion/40% non-propulsion. The supplier then has to calculate the different prices applicable to each and charge accordingly.
One question I had was if I buy goods from non VAT registered suppliers - not diesel - I was thinking about things like bulk firewood - I obviously don't pay any VAT to them. Do I have to charge VAT to my customer when I sell them on though?
Company vehicle. I currently use a 4WD Transit van as my daily driver. If I was to use this vehicle for making my deliveries, how would I go about it for accounting purposes? Would the vehicle belong to me or the company? Obviously I'd still want to use it for non business purposes in my own time as well as making deliveries to customers. I realise I would require commercial insurance, but would I need to sell the vehicle to my own company or what?
I think that's about it for the moment, so if anyone could give any pointers or advice that would be most welcome.
Thanks for now!
Andy


LinkBack URL
About LinkBacks




Reply With Quote

