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With the economy improving many people are considering starting their own business. With improved work/life balance and increased take home pay it’s certainly an attractive option!

 

So where to start?

 

 

Run your own business, claim expenses and keep your profits after tax. It’s the simplest business structure. Be careful though; the contractor and the business have no legal separation. All profits are taxed in the tax year incurred in regardless of reinvestment in the business.

 

 

Become the Director and Shareholder of your own Limited company. Your Company is a separate legal entity from you. As Director you receive a salary and claim tax-free expenses. As Shareholder, profits are distributed to you by dividend. This is often the more tax efficient structure, although each business has its own individual needs.

 

Want to know more? Foremans LLP are chartered accountants providing specialist services to independent contractors.