Starting other businesses

[kennym]

Hi

Excellent site and informative so hopefully my questions can be answered.

I have owned and run my own decorating business for over 10 years now and feel it's time to move forward (or multiply, depending on your answers!).

I would like to open another decorating business in a different region while keeping my existing business operating. The reason for this is that when choosing a decorator, most people prefer using local contractors to carry out the work. The problem is that my existing business name, phone number and address all speak for themselves regarding it's location and so rule out expanding the existing business into other regions(hopefully this is making sense!).

I'am currently registered for VAT and am planning on going limited in April.

My questions are:

Would it be better to start an umbrella company that in turn owns regional decorating company's?

If so, I would appreciate any advice on the ins and outs of this?

If not, do I have to register the new business for VAT given that my existing business is VAT registered(same person ownership).

I have loads of other questions but iv'e probably asked enough for now.

Any help would be appreciated.

Cheers

kennym

[taiarain]

How much of your business do you expect the second company to take up? I'm afraid I'm really not sure what I'd do in your situation.

[Brian Turner]

This is definitely one to get advice from an accountant on - I enquired a while back about running an umbrella company, and the reply was that the accounting costs alone may off-set any potential benefits.

Anyway, welcome to Platinax.

[taiarain]

I didn't even think of the accounting fees. I was thinking of additional paperwork and other types of reporting.

[kennym]

Thanks for your reply's.

I wasn't too concerned about the extra paperwork as long as there's money to be made at the end of it. (famous last words!!)

Looks like your right though regarding accountancy fees. I'm told they could at least triple.
Think I might have to go back to the drawing board on this one, although I'm not giving in just yet...watch this space!

Cheers

Kennym

[taiarain]

Have you considered changing your name and just expanding the original business? If you have an existing client base, it shouldn't be too much of a problem.

[kennym]

Yes, I have considered this but I think I'd rather it was a worsed cased scenario really.
I feel it's taken a long time to get the familiarity that I have and am scared to throw that away.
Perhaps I'm just too sentimental.

Cheers

Kenny

[Joyous]

Originally Posted by kennym

Hi

Would it be better to start an umbrella company that in turn owns regional decorating company's?

If so, I would appreciate any advice on the ins and outs of this?

Hi Kenny

Not necessarily. It’s possible for a limited company to trade under a number of different trading names. You could therefore use a diffent variation of your name for each region.

The benefit of separate companies is that each company's affairs are its own so if one company get sued or runs into difficulties the other companies remain unaffected. The downside is the increase in cost in term of accountancy fees, compliance costs, administration etc.

Originally Posted by kennym

If not, do I have to register the new business for VAT given that my existing business is VAT registered(same person ownership).

If you decide not to separate out the new business then it also will be VAT registered. It is the person that is registered for VAT – not the business.

Regards

Joy

[kennym]

Joy

Many thanks for that information..I'll look into it and keep you all posted as to how I get on. (although there will no doubt be more questions before that!).

Cheers

Kennym