1. Limited Liability Protection
Starting a new business in the UK? Do you know which formation structure to use? Here are 5 good reasons to set up a Limited Company in the UK:
Limited Liability Protection: One of the primary reasons to set up a limited company in the UK is that it provides limited liability protection. This means that the shareholders’ liability is limited to the amount they have invested in the company, and their personal assets are not at risk if the company runs into financial difficulties or gets sued
2. Tax Efficiency
Limited companies in the UK are taxed separately from their owners. This means that the company’s profits are subject to corporation tax, and any salaries or dividends paid to shareholders are subject to income tax. By using salary and dividends, owners can potentially save on National Insurance Contributions and income tax.
3. Professional Image
Having a limited company can help you create a professional image for your business. It can increase your credibility with customers, suppliers, and investors, and can give your business a more established and trustworthy appearance.
A limited company can continue to exist even if the directors or shareholders change. The company’s assets and liabilities are separate from those of the owners, and the company can continue to operate even if the owners sell their shares or retire.
5. Access To Funding
Limited companies in the UK have more options for raising funding than other business structures. They can issue shares to raise capital, apply for loans or overdrafts, or secure investment from venture capitalists or angel investors. This can give the business greater financial flexibility and help it to grow and expand.