I’m self employed – when should I convert to a limited company?
Author: Russell SmithJuly 2, 2015
This is a fairly straightforward question.
It is when the tax saving becomes more than the accountancy fees.
Accountants will charge you 2-3 times the annual fee of for a limited company compared to self employment. This is because there is about 3 times more work that needs to completed for a limited company.
The great advantage of a limited company is that there are huge tax savings on offer.
So as a quick magic number – I would say £30,000 profit. At this point, you need to be looking at the tax saving and at converting to a limited company.
Notice, it is PROFIT not your sales income. Because you are taxed on profit, this is the more relevant number.