# Technical Questions regarding UK Limited Company [LTD] Structure _Please feel free to open an [Issue](https://github.com/coding-amigos/company/issues) or [Pull Request](https://github.com/coding-amigos/company/pulls) to contribute :-)_ Please file an issue, if any of the sources listed below is out of date ### Goals 1. About every holding (e.g. Ltd. owned and operated by a single person) represents a DIGITAL NOMAD and will hold one or many other (e.g. Ltd's). Every project, (e.g. creating an "App") will be owned by 1 or many DIGITAL NOMADs. 2. Trust? Open Structure - The contracts how those entities will collaborate with each other shall be open sourced and collaboratively evolved. Open Process & Results - Every DIGITAL NOMAD (in the above definition) should work completely transparent (even the monetary transactions and current balance sheets) in order to protect against corruption. 3. Vision? There will be a strong focus on automation of all kinds of bureaucracy… and because projects are co-owned and there are no employees, there is also a need to experiment how to coordinate/synchronize with each other and/or agree upon stuff. The or a next step would be to play around with crypto currencies and crypto shares (ethereum.org). The former, because i personally believe that real democracy lies in a correctly structured monetary systems, where money represents votes. Other templates: ### Roadmap * __extend__ - add questions * __optimize__ - adapt for lawyers * __restructure__ make categories ``` npmgenerate-identity // generates identity, publishes to npm, installs it locally & globally > npm bin identity // manage identity on npm and onename.io to publish new versions to npm // .identity/ (contains private keys + is explained to user !!!) // HELP -- terminal -- terminal-menu -- serve browser npmgenerate-company // generates company, publishes to npm, installs "company" globally // uses require('identity-founderName'); > company // manage company on npm // HELP - only available if in company directory -- terminal -- terminal-menu -- serve browser workspace/companyName/ node_modules/identity-serapath Organs/ BoardOfDirectors/ index.js director.js ShareholderMeeting/ index.js Roles/ Founder/ Shareholder/ Director/ ``` ### SOURCES: Monitor Source Links * https://chrome.google.com/webstore/detail/page-monitor/pemhgklkefakciniebenbfclihhmmfcd * http://onwebchange.com/pricing * http://onnoz.home.xs4all.nl/www.followthatpage.com/www.followthatpage.com.htm * http://visualping.io/faq#pricing * https://versionista.com/confirm ### Goal Register a business, today Why? When selling to people directly (whether you're selling services, or selling products to large companies), people will, as part of their due dilligence, often check when your company was registered. If your company registration date is 2 months ago, you will be at a disadvantage in negotiations about price, up-front payments, and other similar things. If your company was registered five years ago, though, this point will not be brought up. In addition, many potential bits of business may come your way over the years. If you have no registered business, you may discard those opportunities because of the perceived difficulty of setting up a business to take advantage of them. Having the business already there may give you the necessary push to grab opportunities. Finally, simply having a business will change your mindset ever so slightly, and make it more likely that you do some day take the jump. This is simply because of the way our brain works. By taking this extremely easy and minor step towards running your own business, you will make it easier for yourself to take the more difficult, future steps in that direction. Consider it a minor brain hack. * get official answers from: * laywers * accountants, * government institutions * build Free Open Source App to help with setting up and maintaining a LTD # Categories ### Holding Structure 1. How to make one LTD the owner of another LTD? 2. How much taxes does the holding pay for profit from the owned LTD? 3. What are other differences between having a natural person vs. a holding as an owner? * taxation * bureaucracy * responsibilities * etc. ### Opening a LTD 1. What is the process of opening a LTD? * To whom to report what during the process and after? 2. Is there a difference if a founder a natural person vs. a holding? 3. What are the costs? (Founder does everything vs. Accountant/Lawyer) 4. What forms are needed? 5. Can it be done purely online? 6. Does the founder need to live in the UK? 7. Does the holding need to be from UK? 8. Is a notary required? 9. Does the LTD need a UK bank account? 10. Do owners need to have bank accounts in UK? 11. Is a registered office required? --> You atleast need a postbox ( https://www.gov.uk/limited-company-formation/company-address ) 12. Can it be a virtual or rented adress? --> Yes( https://www.gov.uk/limited-company-formation/company-address ) 13. How expensive would be the cheapest offer? 14. Does the company need an office located in the country of registration (UK)? --> No ( https://www.gov.uk/limited-company-formation/company-address ) => A person registering a UK Ltd. Company and a director, secretary or shareholder of a UK company can live anywhere in the world 15. Can a company office be a home adress? Home office --> Yes ( https://www.gov.uk/limited-company-formation/company-address ) 16. Kann ich eine Ltd. gründen, obwohl ich nicht in UK wohne? --> Ja. Wir stellen alle zur Gründung erforderlichen Positionen. Es spielt weder Ihr Wohnort noch Ihre Staatsangehörigkeit eine Rolle. 17. Muss ich zur Gründung oder später persönlich im Gründungsland erscheinen? --> Nein. Sie können sich bequem zurücklehnen. Das bedeutet, Sie können eine Firma gründen ohne Ihren Schreibtisch zu verlassen. ### Running a LTD 1. Bin ich vor persönlicher Haftung geschützt? Ja. Wenn Sie die Geschäfte über die Gesellschaft abwickeln, haftet auch nur die Gesellschaft. Ein Haftungsdurchgriff auf den Geschäftsführer, wie er z.B. in Deutschland üblich ist, ist weitestgehend ausgeschlossen. ### Closing a LTD 1. Droht mir im Falle eines Konkurses Gewerbeverbot? --> Nein. Sollten Sie mit Ihrer Firma wirklich Schiffbruch erleiden, können Sie schon am nächsten Tag eine neue Gesellschaft gründen. Sriking off a limited company Private companies that have not traded or otherwise carried on business for at least three months may apply to the registrar to be struck off the register. Companies house charge a fee of £10 for strike offs and require form 652a to be filed. http://ukdata.com/help/credit-reports-documents/status-strike-off-dissolution http://support.companywizard.co.uk/652a_striking_off.htm ### Export of Products/Services _Majority of customers of a LTD owned by a holding __are not__ from UK_ 1. How is the LTD taxed? 2. How is the Holding taxed? 3. What is the difference between customers from EU vs. Non-EU? 4. Is there a difference between certain EU countries? _Majority of customers of a LTD owned by a holding __are__ from UK_ 1. How is the LTD taxed? 2. How is the Holding taxed? ------------------------------------------------------------------------------- A. I am resident in UK with a Limited, but it happens, that my business evolves in a way, that large majority of customers are from one foreign EU country. Do i need to register my business there too? B. I am resident of UK, but will travel for some month abroad EU and when i return, i will probably switch residency inside EU a lot (world traveler). The customer base of my apps and services will be all araound EU, but it might happen, that large majority of customers will be from one EU country. Do i need to register my business there? C. I'm living in germany and will probably have my customers from here in the next couple of months. I will move my permanent residency and from there on also my customer base to UK an leave germany behind for good. I might still have some legacy customers for a while. Do I need to register the company in germany too or can i avoid that altogether? ------------------------------------------------------------------------------- ### Reporting 1. To whom is a LTD obliged to report and in which intervals? _(monthly, yearly, ...)_ 2. To whom is a Holding obliged to report and in which intervals? 3. Which forms to use for reporting and where to get them? * Salaries? * Travel costs? * VAT? (if necessary at all) * income costs? * invoices? * others... 4. Is it possible to report online only? (If so, where?) 5. What are the costs related to all the reporting? (Done by: Founder vs. Accountant/Lawyer) ### Archiving 1. Which documents (bank statements, invoices, ...) have to be kept? 2. How long do they have to be kept? 3. What are the requirements for digitalizing those papers? 4. Are there any circumstances under which some documents cannot be kept in digital form? ### Taxes 1. If LTD owner who is also director, lives in Berlin and creates software for customers in Berlin, do taxes need to be paid twice? ###### VAT 1. Is VAT registration required for a LTD with less than 81000 £ revenue? 2. Will that change in the near future? 3. Does LTD have to charge VAT to customers outside of UK? --> for private persons yes, for companies not with VAT number. New tax rule next year: you have to charge the VAT of the country (so 19% DE, 21% NL etc..) if you sell things to private persons without VAT number. 4. Does LTD have to charge VAT to customers outside of EU? 5. Does LTD have to pay VAT for goods purchased outside of UK? --> not with a VAT number of the supplier 6. Does LTD have to pay VAT for goods purchased outside of EU? 7. How often to report VAT and to whom? 8. Which forms to use for VAT reporting and is it possible to do that online? 9. Which business transactions are accepted as business costs? * phone bill? * business meeting expenses? * office space? * home office? * etc. ###### Profit Scenario: Annual revenue is less than 80000 £. Number of employees is one _(only the founder)_. Service is creating custom software for clients or software as a service (App). 1. What is the formula for calculating the amount of all taxes in one year? 2. What is the approximate height of tax given a profit of * 10000 £. * 0 £. * -10000 £. * 50000£. 3. Is there a lower limit of revenue or profit until which no taxes have to be paid? 4. Is a new LTD freed of any reportings or payments for a certain time period? 5. Does taxation change when the owner is a holding compared to a natural person? 6. To whom and when to pay the tax? 7. What type of investments can be used to lower profit tax? ### Invoicing 1. Where to get an invoice examples which fulfills all requirements? 2. Do small invoices all need to include information about the buyer * e.g. invoice for office pencils? ### Accountants & Lawyers 1. What are costs for accountants based on? 2. Is there an official standard price list? 3. What would be approx. monthly costs for accountant for * LTD with 1 employee (owner, minimum salary) * less than 80000 £ annual revenue * approx. 5 outgoing invoices, 10 incoming invoices a month 4. What are the rules regarding amortization of equipment? * computer, office chairs, office tables, etc. 5. How much does it cost if an accountant prepares and sends all the reporting related to employees and other reporting requirements? ### Employment 1. What is the minimum number of different natural persons legally required to be employed in the LTD? 2. What is the minimum amount of monthly working hours required? 3. Can a director be employed in another LTD? _(e.g. holding)_ 4. What is the minimum gross salary for a director? 5. If there are any requirements for roles in LTD, is it possible to employ another LTD as a director instead of a natural person? * Would a sole proprietor (contractor) instead of a regular employee be okay? * How is that treated legally? _(differences from natural persons as employees)_ 6. Can the only owner and employee of LTD be a foreigner who does not live in UK? _(inside vs. outside of EU)_ 7. If director of a LTD is a foreigner and does not live in UK, does he have to pay pension/insurances/etc in UK? (If yes, how much?) 8. Is it necessary, that any owners or employees need to live (permanent residency), or have citizenship of UK 9. What is the legally required structure of costs for one employee (director)? * Pension * Health insurance * etc. 10. Can any legally required services for employees be outsourced to a different country? (e.g. slovenian health insurance?) 11. How to pay freelancers from UK vs. EU vs. non EU (which forms to use, what are the costs)? 12. How to pay an intern from UK vs. EU vs. non EU (which forms to use, what are the costs)? ### Minimum Costs ###### Opening LTD 1. What are the minimum costs of opening LTD, given that all paper work, if possible, is done by the founder? --> Nein. Alle von uns angebotenen Firmenkonstellationen basieren auf Aktien, auch die englische Limited. Da aber nur eine Aktie Stammkapital gezeichnet werden muss um aktiv zu werden, ist hier auch nur eine Investition von ca. 1 US$ nötig. 2. Are accountants, lawyers or other professions required for some of the formalities necessary for setting up the company? 3. And what would be the approx. minimum costs for that? ###### Running LTD 1. What is the approx. minimum total yearly costs of running an existing and operational LTD which has no revenue at all, has minimum costs for accountant? * Can that costs be lowered, if founder does the necessary work required by law instead? ACCOUNTING COSTS It depends on (among other things) Startup and investment costs The business the company is in The turnover The profit The location (state and city) Who/how the accounting is done (external/internal) The division of national/international business [SOURCE: unknown](http://www.toytowngermany.com/lofi/index.php/t48164.html) COSTS for TURNOVER of around 40k I think you will find the annual "running costs" of a Gmbh or a Ltd will be pretty much the same assuming you are using an accountant locally here in Germany. On that small turnover you can probably prepare a lot of the information yourself for the accountant. [SOURCE: unknown](http://www.toytowngermany.com/lofi/index.php/t48164.html) I have been in the wars in the past. Basically the UK authorities are a bunch of softies, whereas I can see the Germans chasing your arse to the firey side of hell and back for €10. [SOURCE: unknown](http://www.toytowngermany.com/lofi/index.php/t48164.html) ### Sources/potential information https://www.gov.uk/limited-company-formation/overview