For many people, the idea of becoming their own boss is extremely appealing. The most common route is to set up a Limited company, as it allows the individual to benefit from a wide range of perks, including unbeatable tax efficiency and considerable protection in the event of financial problems.
New research from polling organisation Ipsos MORI and HMRC finds that incorporating a business is generally a smart way to make money, as 65% of Limited company contractors reported a healthy profit during 2012-13. This is compared to 19% who made a loss and 9% that only managed to break even.
The overwhelming majority (80%) of company directors would recommend incorporation to those considering making the leap from traditional employment. Perhaps unsurprisingly, this figure rose to 94% among those individuals who earned £50,000 or more per year. … Continue reading