What is a Limited Company? | Clear Explanation for UK Businesses
13 August 2026
A limited company is a separate legal entity from the people who run it. The business can own assets, enter contracts, and owe money in
A limited company is a separate legal entity from the people who run it. The business can own assets, enter contracts, and owe money in
To register for MTD for Income Tax, you’ll need a Government Gateway ID, MTD-compatible software, and your National Insurance number. VAT-registered businesses are already enrolled
A limited company separates you legally from your business, lets you pay yourself through a mix of salary and dividends, and caps your personal liability.
Income tax is charged in bands on income above your £12,570 personal allowance. Moving into a higher band only increases the rate on income above
Being a sole trader means you can start trading immediately, keep all your post-tax profits, and run your business with minimal admin: no Companies House
Cash accounting lets you pay VAT only once your invoice is settled. Accrual accounting charges it when the invoice is raised. Only businesses with taxable
