In the last part of my blog, I include some considerations of becoming a limited company, as well as some resources I found useful.
Considerations of going Limited:
– It can appear more professional to some clients who will expect to deal with a limited company (this really depends on your type of artwork and who you sell to/work with)
– Depending on your annual turnover, it can be better for your taxes. Company directors often pay themselves a small salary up to the tax-free threshold and then take dividends from the profits of a company that aren’t subject to the same taxes and contributions.
– Setting up a pension is a legitimate business expense and tax advantage (if you’re turning over enough to pay yourself and set one up – this can be an aim for later in the business if it does well).
– Assets and involvement in tenders for work are totally separate from your personal life and assets.
– Your business name cannot be copied.
– If you ever need business finance it will be easier to apply for.
– There are much more administrative hoops to go through and your accounts are much more public than trading as a sole trader.
– Accountancy costs can be quite high in relation to a self assessment as a sole trader
– Being a director of a limited company means you still have to file a self assessment to HMRC.
– More tax effective if you get a large contract
Remember to consult a professional on what options are best for you; this is not formal financial advice.
Resources I found helpful:
Https://articles.bplans.com/how-to-write-a-business- plan-for-an-artist-business/
Http://articles.bplans.com/how-to-write-a-business-plan/
Https://www.theguardian.com/small-business-network/2013/sep/12/sole-trader-limited-company-freelance
Role Models Podcast – this is an inspiring podcast that interviews women who work in many different sectors. One of my favourites as the presenter has a gentle style that manages to really get the best and most insightful responses from his interviewees http://rolemodels.co
Creative Women International – website and great podcast series of tips and advice about running a creative business in a clear way, with an understanding and sympathy for the advantages and pitfalls of running a creative business http://www.creativewomeninternational.com
Art Biz Podcast with Alyson Stanfield – advice from an expert across the pond. Alyson gives tips and also insightful interviews with artists from a range of disciplines about how they run their art businesses and lives – http://www.artbizsuccess.com
You can find out more about me, and what I do at my website http://elisaartesero.com
