'Trading As' ...

Author
Discussion

mybrainhurts

90,809 posts

256 months

Saturday 7th March 2015
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Eric Mc said:
You can always change the name of the actual limited company. You do not have to resort to adopting a "trading as" style of name.
Yes, thanks Eric, I know that. I was running with the faff factor back there...smile

Eric Mc

122,058 posts

266 months

Saturday 7th March 2015
quotequote all
Nothing wrong with a good faff every so often.

Birkin1932

784 posts

140 months

Saturday 7th March 2015
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I have one limited company with 6 different 'trading as' trademarked brands, all have their own dedicated websites, all money gets paid into that 'trading as' dedicated bank account and once a week it all gets 'brushed' into the Limited Co.

Easy peasy

LDN

Original Poster:

8,911 posts

204 months

Saturday 7th March 2015
quotequote all
Birkin1932 said:
I have one limited company with 6 different 'trading as' trademarked brands, all have their own dedicated websites, all money gets paid into that 'trading as' dedicated bank account and once a week it all gets 'brushed' into the Limited Co.

Easy peasy
This is exactly what I want to do - but without the each brand having it's own bank account. Could you not do the excat same but just have everyone pay into the LTD account direct? What is the purpose of have the seperate accounts in the first place? Purely for the look? Or admin?

Birkin1932

784 posts

140 months

Saturday 7th March 2015
quotequote all
Because we get cheques in the name of the brand, visa payments in the name of the brand etc etc. Its no big deal to have satellite bank accounts.

Eric Mc

122,058 posts

266 months

Sunday 8th March 2015
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How do you handle the statutory reporting requirements and the Corporation Tax regulations?

In particular, the claiming of loss relief and Capital Allowances?

Birkin1932

784 posts

140 months

Sunday 8th March 2015
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Hi Eric, I leave the technical stuff to Grant Thornton, but everything is owned and purchased by the Ltd Co, websites, buildings, machinery, trademarks etc etc. So its one company with multiple brands, all bank accounts are sub-accounts of the Ltd.

I am very surprised you haven't come across this before to be honest

Eric Mc

122,058 posts

266 months

Monday 9th March 2015
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Most of my clients are quite small so they don't have much need for "branding" or multiple brands.

Birkin1932

784 posts

140 months

Monday 9th March 2015
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Fair enough Eric.

mybrainhurts

90,809 posts

256 months

Monday 9th March 2015
quotequote all
Eric Mc said:
Most of my clients are quite small.
Leprechauns, eh...? hehe

Henry-F

4,791 posts

246 months

Tuesday 10th March 2015
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The reason we use "trading as" is for efficiency in dealing with Corporation tax.

If we had 3 separate companies the small profits rate allowance (up to £300k) would be divided equally amongst all 3 rather than allocated on a profit basis. If company 1 only made £10k we would effectively waste £90k's worth of small profit taxation.

As things stand now the difference between normal and low profit CT is small and will be zero but a few years ago it was significant as you went from low profit CT into a higher marginal rate (£300k - £1.5m) before dropping back down to the standard rate of CT.

Low profit was 21%

Marginal rate was 29.75%

Standard rate was 28%

Henry smile

Eric Mc

122,058 posts

266 months

Tuesday 10th March 2015
quotequote all
Do the different "trading as" names truly mean that you have genuinely different trading activities being run under a single limited company?

If that is the case, as I mentioned previously, that can actually really complicate the Corporation Tax situation - as well as the accounting disclosure requirements.

I hope you and your accountant are aware of this.

sumo69

2,164 posts

221 months

Tuesday 10th March 2015
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I would assume the underlying products are of a similar or complementary nature of each other and are marketed in a similar manner, thus allowing the company to prepare tax comps on the basis of a single trade.

I have a client who has 2 separate trades in 1 company - the comps are a PIA especially dividing up non-attributable costs!

David


Eric Mc

122,058 posts

266 months

Tuesday 10th March 2015
quotequote all
That's exactly what I was alluding to.

To me, having separate trading names would indicate to HMRC that you are definitely running separate trades within the same limited company. This can be especially troublesome when claiming loss relief or Capital Allowances.

anonymous-user

55 months

Tuesday 10th March 2015
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In our case we running differing trading styles but conduct essentially the same business.

eg in my insurance business we would have one regulated entity and trade as (e.g. only)

Cheap and Cheerful Insurance
Expensive and Serious Insurance

Insurance for Cars
Insurance for buildings


that sort of thing.

Each trading style has to be disclosed to the FCA.

sw

Eric Mc

122,058 posts

266 months

Tuesday 10th March 2015
quotequote all
But are they the actual SAME business (as opposed to the same general type of business)?

In one tax case, HMRC was able to successfully argue that a chap running two identical fish and chip shops was running two entirely different businesses.

anonymous-user

55 months

Tuesday 10th March 2015
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Eric Mc said:
But are they the actual SAME business (as opposed to the same general type of business)?

In one tax case, HMRC was able to successfully argue that a chap running two identical fish and chip shops was running two entirely different businesses.
The same business.

Birkin1932

784 posts

140 months

Tuesday 10th March 2015
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I asked my Grant thornton boys just for you Eric, probably get a £500 bill now :-(

They said that HMRC says this:

"In terms of companies, activities are only likely to amount to more than one trade if:

one activity is so different in nature from the other that it can be seen as quite separate; and
the activities are separately organised and managed right up to Board level."


Eric Mc

122,058 posts

266 months

Tuesday 10th March 2015
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That chip shop chap must have had a very complicated management structure.

sumo69

2,164 posts

221 months

Wednesday 11th March 2015
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Eric Mc said:
That chip shop chap must have had a very complicated management structure.
Directors names were:

Mr F R I D'addock

Mr C Hips

Mrs F Ishcake

David