Sole Trader to Limited Company

hairylairy

I work from home, providing book-keeping and accounting services to sole traders and partnerships. My net profit is about £25000 and I've been self employed about 20 years. I've been considering whether it's time I incorporated the business to a private limited company, primarily to save tax. Any advice or guidance to do it myself would be greatly appreciated. Especially with regard to goodwill value, level of directors pay, whether to use an agent to incorporate etc. Also, if I were to sell the practice in a few years, would CGT be on the difference of the sale price less the value on incorporation (less the annual exempt amount of course)? Please can anyone help?

Gem7321

Are you sure it is free goodwill? How much do you think the business is worth?

Have a look here http://www.accaglobal.com/content/dam/ACCA_Global/Technical/fact/technical-factsheet-171.pdf

Have you actually ran the figures? Assuming you have no other income the tax saving on this level of income is fairly insignificant.

I think you'd be best getting some face to face advice.

If you were then to sell the company then I assume you would be selling the shares and would qualify for entrepreneurs relief.