Decision LLP or Ltd Co?

[5yearstobuyatvr]

Currently a partnership for 23 yrs. decided to re brand and start as an LLP or LTD CO. NOT sure which way to go.

[mondeoman]

Only real reason afaik to go LLP is for tax reasons ...

What market are you in?

[Eric Mc]

I would think that, if limited liability is what you are after, a limnited company might be the best option. There are some good tax advantages too.

What does your accountant say?

[5yearstobuyatvr]

We are engineering machinists,My accountant says ltd co,oyher emgineers nearby go for LLP because it suits them for their large cars

[Eric Mc]

Making a business structure decision on the basis of what car you want to drive is deeply flawed and trivial.

Edited by Eric Mc on Monday 25th January 07:56

[5yearstobuyatvr]

Quite agree

[Somewhatfoolish]

Why not do both? I have an LTD which I am in partnership with as an individual in an LLP. Gives you advantages of both.

[Eric Mc]

Somewhatfoolish said:

Why not do both? I have an LTD which I am in partnership with as an individual in an LLP. Gives you advantages of both.

That can be useful - but it can life rather complicated and you need to be totally on top of your withdrawls from both businesses and the debt relationship between both businesses (which there invariably is).

[5yearstobuyatvr]

Just in the process of setting up a ltd co.

[jon-]

Eric Mc said:

Making a business structure decision on the basis of what car you want to drive is deeply flawed and trivial.

Edited by Eric Mc on Monday 25th January 07:56

Speaking of this, I've a question regarding cars.

As a sole trader it's fairly easy to run a business vehicle, restrict the 20% capital gains write down by the percentage used by the business.

What happens in the event a sole trader turns into a Ltd Co and wishes to remove the car from the books?

[Eric Mc]

Treat it as a disposal of the vehicle and substitute the current market value of the car for the "sales proceeds". The final Capital Allowance computation for the sole tradership will then show a "Balancing Allowance " or a "Balancing Charge" depending on whether the proceeds/market value was greater or lesser than the Written Down Valuie of the car.

Simples