Going Limited

I’ve been considering forming a limited company to operate under for quite a while now, and this weekend I finally went and did it. I thought I’d put together a quick post for anyone in a similar boat.

Why go limited?

As I’ve documented previously, I started out as a sole trader under the slight self-misbelief that I’d “freelance for a while until I found the right proper job”. Being a sole trader seemed to make sense in that mindset, although my accountant did mention right from the start that I may want to consider forming a company if things really took off.

I gave myself a year to test the waters, to make sure this was the right thing for me to be doing, and now I know it is I want to formalise my business a bit. Going limited for me was really about several things: finances, liability, and having a bit of an identity. Most people will probably say something similar.

On the finance side, not only was it advised as being a more effective way of managing income and taxes, but I also wanted to be in a position where if certain opportunities come up, I would be to be able to take them without stalling. Certain companies won’t work with sole traders,  and whilst it hasn’t been a problem for me to date, you never know what may happen.

With liability, as much as individuals can take out business insurance etc, there’s something nice in knowing that I won’t just have someone turning up and claiming my house if something catastrophic does happen. It always felt a bit selfish to me, as someone with a joint mortgage and finances, to be potentially putting someone else’s life on the line as well as my own.  The protection that a company gives an individual is a nice bit of reassurance… although hopefully nothing will go that wrong!

Finally, and pettily… I miss belonging to something. I was “Sally from X” for so long, and I’ve always struggled a bit when asked for a company name for a conference, or when you’re asked to introduce yourself. I’m not intending to promote my new brand at all – I am the service, so it’ll still just be me operating as me – but regardless of whether my limited name means anything to anyone else, it’s nice to feel that I have an actual company now.

Introducing…

Records Sound the Same Ltd.

But that’s got nothing to do with the web industry, Sally, you fool!“. Exactly. When picking  a name, I knew I wanted certain things. I didn’t want a name that restricted or defined what I did, i.e. I didn’t want a “Something Consulting Ltd”, “Something Technology Ltd”. Our industry changes so much, terminology becomes dated fast, and who’s to know that I won’t end up on a different path? I also didn’t want any bloody animal/colour cliche (although my other half suggested Animal & Colour Ltd, which, for my sins I do actually quite like). I wanted something that meant something to me, because although a lot of people form companies every day, it still feels like something that is a bit of an achievement. I didn’t just want to register my name though, because let’s face it, your name is never usually as cool as something you pick yourself.

Apparently though, unlike band names or cat names which I’m both pretty good at, it’s pretty bloody hard to decide on a company name. Everything seemed not to quite work, or to have some kind of negative connotation, or to relate to something else that I’d used for usernames. Once I’d registered it, I obviously thought of something else that was cool. I’m pretty certain I’ll think of some much better ones over the coming week or so, but it’s done now.

And why do all the other records sound the same?” is a snippet of a lyric from an early Jimmy Eat World song, Angst For Joel, off their first EP “One, Two, Three, Four”, a scrappy, punky, little mess of noise far detached from their present blandness (where, amusingly, all of their songs do now sound the same). The EP has been left off their website discography along with everything else prior to Static Prevails, but it does exist. I’m taking that as a sign that they’re not fussed about my usage of it. It struck a chord (ho ho) with me when I was browsing through lyrics for inspiration, because of the differences and similarities we deal with in this industry. We go through patterns of everything looking the same; we’re often accused of being an industry of young, white, acquisition-hungry males; we use whatever tech or tools are the new hotness that week. On the other hand, we have people breaking down real barriers, introducing new ways of thinking, and who aren’t afraid to defy conventions. I have frequently come up against people struggling to pigeon-hole me, but I don’t want to be pigeon-holed; I want to do what I know I’m good at and what I like doing. So the name’s also a bit of a reminder to myself to stick it out.

 

‘Angst For Joel’ – Jimmy Eat World. 1994.

The process

Getting registered was reasonably straightforward. My accountant could have done it for me, but for £250 I wasn’t that keen. The main benefit of getting them involved would have been if I had wanted any kind of complex set up with non-standard articles of incorporation etc. As it was just me and I’m not intending to go public or sell etc, my company is as simple as it gets.

Registration process

I’d been messing around on the Companies House Name Check for ages testing out different ideas, so knew that my name was available. When it actually came to forming it, I made sure I’d read up on the information on gov.uk around the process, then followed the link to register. The Companies House registration site could use some work, but overall I had no real problems – where I was unsure of terminology there were usually help suggestions which made it somewhat more clear. It costs £15 to make an application, and can’t have taken me more than 30 minutes to an hour to do. After you incorporate the company, you then need to provide Corporation Tax information to HMRC when the company starts any business activity. As usual with HMRC, this is a sea of confusing words, but it mainly focuses on the date of your incorporation and when your company year end will be.

I was emailed the certificate of incorporation and memorandum of association this morning, so it’s all official. Now it’s all set up I’ll be updating my site and paperwork to reflect the changes, but otherwise it’s pretty much business as usual!