If you’ve been a building contractor or subcontractor for a while and you feel like you’re ready to take the next step in your career, going limited is a great option. Our guide explains how going limited and working as a limited company director can help you take home more pay.
Should I become a limited company director?
Becoming a limited company director could be a great choice if you have plans to expand your business, have frequent expenses, and plan on contracting for a long time.
Benefits of working as a limited company director
There are many benefits to working as a limited company director. There may be a little more paperwork than you’re used to, but the benefits make this worthwhile:
- Ability to grow your business: as a limited company director, you have more opportunities to grow your business. You can also hire employees.
- Ability to claim more expenses: you’re likely to be used to claiming several expenses if you work under the Construction Industry Scheme. However, as a limited company director, there will be an increase in things that you can claim as a business expense. For example, you can claim the costs of marketing and advertising your business.
- Improve your tax efficiency: As a limited company director, you can pay yourself a combination of salary and dividends. As dividends are taxed at a lower rate, this is often considered the most tax-efficient way of working.
How to become a limited company director
Becoming a limited company director couldn’t be simpler. Once you’ve decided on a name for your new company, simply follow the application process on the Companies House website.
Once your company is formed, you will receive a certificate of incorporation to prove the company legally exists.
Speak to an expert
When it comes to making a decision on forming a limited company, why not speak to us? We’ll run through your situation and give you the best advice.
