UK Landlord Forum / Life

Can anyone give advice on the best way to approach property development? I have been wondering for a while whether or not I should develop as a company or as an individual. If as a company, should I go Ltd or as a sole trader? What are the advantages/disadvantages?

Thanks,
Adam.

Hey Adam,

If you think you're going to make a loss during the first year, it's better to go as a sole trader because if during the first 4 years of trading you make any losses, you can carry those losses back against the previous 3 years of employment.

However, if after the first period you then make a profit, you can then form into a limited company. Why? Because their are better tax advantages as a limited company.

If you think you're going to make profit straight away, then register as a limited company initially.

Ah be carefull of the juggling tax act you may have to do if you dont reach any threash hold.  You maybe paying out more tax than any return you could get on your expenses if you go fully registered and LTD.
The other differance is that the whole world can see your state of afairs at companies house if you go Ltd.
I would go sole trader to start with, * which i did*  then as you grow your money will be making the decisions for you. ie as soon as you get to 40k prof you have to register etc
Another advantage is you only need to a self assessment on sole trader, with Ltd you have to submit accounts etc to companies house, which is a pain in the ass trust me, unless you got a money wizz.
Take a look on business link, you will find all the info you need in relation to the question you have asked, there is also some other good reading on there for the budding business man.

Ps welcome Adam. please keep in touch in relation to what you are upto regarding your development/s

Badger