Setting up a Ltd company!

J

JamesHugh

Guest
I am a pharmacist, working as an employee in a small independent community pharmacy, 4~5 days a week!
I was thinking of setting myself up as a limited company, is there any tax benefits or complications from doing so?:)
 
You need to be a bit clearer about why you need the Limited Company. Is it for a new business or a business on the side? If you are an employee now then I don't see how you expect setting yourself as a limited company will help.
If you are the business owner then there may be some advantage transferring existing assets to the Ltd company which are effectlvely your personal assets and which can then be repaid to you. The significant personal protection is that there is an advantage in that your liability will be "limited" if the business goes belly up.
As for personal withdrawings from the company most directors are employees that pay PAYE and PRSI just the same as any employee but naturally with the added obligations in respect to tax returns as directors and company responsibilities which IMHO should not be taken lightly.
 
JamesHugh said:
I am a pharmacist, working as an employee in a small independent community pharmacy, 4~5 days a week!
I was thinking of setting myself up as a limited company, is there any tax benefits or complications from doing so?:)
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No, there are no financial benefits. In fact, there are several costs involved that you won't incur as a sole trader.

Setting up a limited company might sound appealing, but as a Director, you will have several statutory responsibilities that take up a lot of time, and if you fail in them, it will cost you money.

The primary benefit of setting up a limited company is that you personally are not legally responsible for your business dealings, in that the company has the legal personality, which means its liabilities will always be limited to its assets.

ie if you screw up, your creditors can't come after your house.

If this isn't a requirement for you, don't set up a limited company.
 
If you make significant profits there might be a benefit in that The Company can make pension contributions as an expense.

But it sounds like you are an employee at present- In that case i would stay as you are.
 
James

I know its not what you want to hear, but there can be benefits and risks and really you need to talk to an accountant.

BET
 
Why don't you open your own Pharmacy's as a sole trader? Less bureaucracy and easy to run on your own even..
Why do you need a limited company?
 
A limited company provides limited liability.

For example if you were to give someone the wrong prescription which caused someone harm it would be the company that would be liable but if you were a sole trader it would be you personally and your personal assets could be impacted if there was a judgement against you.

With limited liability all you can loose is what is in the company. As a sole trader you are personally responsible.

Thats my understanding of one of the benefits of a company.
 
aristotle said:
A limited company provides limited liability.

For example if you were to give someone the wrong prescription which caused someone harm it would be the company that would be liable but if you were a sole trader it would be you personally and your personal assets could be impacted if there was a judgement against you.

With limited liability all you can loose is what is in the company. As a sole trader you are personally responsible.

Thats my understanding of one of the benefits of a company.
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This is the textbook illustration of limited liability. However, in practice, I think you will find that, for pharmacists and other professionals, hiding behind the veil of limited liability is a bit more problematic than you imagine.
 
T McGibney said:
This is the textbook illustration of limited liability. However, in practice, I think you will find that, for pharmacists and other professionals, hiding behind the veil of limited liability is a bit more problematic than you imagine.
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But it is probably a bit easier than trying to limit your liability as a sole trader where you have no protection at all?
 
aristotle said:
A limited company provides limited liability.

For example if you were to give someone the wrong prescription which caused someone harm it would be the company that would be liable but if you were a sole trader it would be you personally and your personal assets could be impacted if there was a judgement against you.

With limited liability all you can loose is what is in the company. As a sole trader you are personally responsible.

Thats my understanding of one of the benefits of a company.
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Yes that is al true, but you can always buy insurance for such cases.
 
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