When should I Registrer my business?

[Kaptajn01]

Hello Everyone!

I am in the process of writing my business plan and creating some information material. I estimate atleast another 8-10 months before I have a product that I can go out and try to sell. I am planning to set up my company as a limited company. I am a corporate jet captain and will be keeping my full time job during start up and all throughout running this company on the side.

My question is regarding at what stage I should registrer the company. I am spending a lot of time at the moment writing the business plan and looking for investors and do incur a few expenses with relation to the new company.

If I regsitrered now and didn't have any customers for 12 months how would that effect my tax returns and could expenses still be deducted at some point?

Thank you for your time - have millions of questions, but let's take one at a time...

Cheers

Mike

[Indizine]

whatever you spend on the business would be pre-start up costs so just keep your invoices/receipts for when you officially start your business (date you will inform HMRC of). You can then off set them in your tax bill where appropriate to do so. Your business start date can be any time after the company formation date.

You can form the Ltd Co now and make it dormant straight away so keeping paperowrk to a minimum until you start.

[accountantpete]

You can start the company now - any first year losses can be carried forward to be offset against later profits. It will cost you a bit more in accountancy fees for accounts preparation and filing fees but if you approach a firm of accountants they may do a deal re these in anticipation of future business.

The main thing to bear in mind is that if you incur expenses (ie the company pays for anything)the company is regarded as trading so you have to submit accounts and there are hefty penalties for late filing with companies house.

[Indizine]

but if the OP buys them himself and not from the company bank a/c or CC, then can he not add them as expenses when he does start trading, and reclaim the costs back from the company?

[Kaptajn01]

Brilliant! Thank you very much for your quick answers.

If it is correct that I can just use my own personal account to buy material with and later claim those back through the company, I think that will be an easy way of keeping track of it all.

Thanks again and I'll look forward to getting your advise again.

Mike

[accountantpete]

Yes - they will go through as a directors loan account item ie you have "loaned" the company money by virtue of paying these expenses personally.

I only mentioned forming a company now in case you had a specific name in mind and wanted to secure a limited co in this name-personally as Indizine suggests I would wait and see if the business "takes off" -geddit!

[Indizine]

ha ha, it took me a few seconds to get that Pete, forgot he was a captain.

Mike - any tips for FoF? I'm nearly over it, but not there yet.

[Kaptajn01]

I'm so sad I actually had to read it twice before I got it too!

I think I'll probably end up using both of your suggestions. I do have a specific name in mind and it would definitely be helpful to use the "Directors loan" approach too.

I wont be venturing into anything to do with avaition tho - I think it'll be healthy to spread my interests a little... + a wise man once told me," If it flies
, floats or f..ks - Rent it, don't buy it"!!

Indizine, I usually tell our passengers that if there was anything dangerous about the arcraft you are on the pilots would have gotten off already... Otherwise I'll just land in the Hudson

Thanks again!

[accountantpete]

ha ha, it took me a few seconds to get that Pete, forgot he was a captain.

Mike - any tips for FoF? I'm nearly over it, but not there yet.

I take it you have tried the 10 cans of Tennants Extra approach?

[accountantpete]

I think I'll probably end up using both of your suggestions. I do have a specific name in mind and it would definitely be helpful to use the "Directors loan" approach too.

In which case form the company and then submit dormant company accounts (Form DCA) until trading begins - these are dead easy and you can easily do it yourself.

You can file these sort of accounts if the only transactions are the issue of share capital (receipts) - so pay all the expenses yourself.