Aren't there any other matters to consider in deciding whether to incorporate or not?

Higher administration costs to comply with company law, payroll and bookkeeping is one factor. Another issue is pension planning. Extracting profits out of company as dividends rather than salary means that there will be no "net relevant earnings" and therefore pension contributions can't be made. But advent of stakeholder pension plans has meant that contributions up to œ3,600 per year can be made without need for any earnings. If a person does not wish to transfer funds in existing plans into stakeholder because of high charges, there is a way out: best net relevant earnings (i.e. salary) in five consecutive years can be used for making contributions for next five years, even if there were no salaries in remainder four years. It is comforting to know that entitlement to basic state pension is not affected by taking a salary from company at level of a person's personal allowances i.e. œ4,615.

Furthermore, an individual may decide not to bother with pension plans and instead invest in ISA. Often, these can be more efficient than pensions but that's beside scope of this article. If that option is taken, no salary is necessary.

Another factor is business motoring. It might be tax advantageous for an unincorporated business that owns many cars not to incorporate because if these cars have some private use there will be benefits in kind taxed on users. These are generally higher than straight apportionment between private and business for all car running costs in case of sole traders.

The conclusion is that there can be considerable tax savings waiting sole trader who decides to go down road to incorporation. But, one needs to proceed with caution and careful planning. And don't forget biggest advantage of incorporation, which is Protection from Personal Liability. Incorporating is one of best ways to protect a business owner from personal liability. Shareholders of a company are generally not liable for obligations of company. Creditors of a company may seek payment from its assets, but not assets of shareholders. This means that business owners may engage in business without risking their homes or other personal property.

Thank you for taking time to read this Article. I hope you've found it useful. If you have, please drop me an email and let me know what you think.

You can email me at...

constantinesavva@accamail.com

Alternatively, you can visit our website at http://www.tax-accounting-london.info and read a series of other full length articles that present complete picture on a variety of interesting topics.

If you would like to know how to save tax and make sure that more of your hard earned cash stays with you to expand your business and increase your profits, we have a Free Special Report addressed to small businesses either starting up or already in business. This Exclusive Free Special Report is available automatically when you subscribe to our regular series of Free Newsletters on finance advice and tax planning by visiting our subscription area on our website www.tax-accounting- london.info. It is complied from real life situations dealing with small business tax affairs for over 10 years and it is loaded with down-to-earth advice and practical, understandable examples.

LEGAL NOTICE Whilst every care has been taken in preparation of this article, author cannot accept responsibility for any errors or omissions. Proper professional advice should be taken at all times.

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It's not easy doing things differently, but unless you do job you'll never progress. This is where your desire to succeed will be tested.

DISCIPLINE

Trust me on this one. It is SO easy to start wanting to live benefits of working from home before you've earned them. Sure, you're boss, you can take a day off whenever you want, but then nothing gets done that day either.

You will need to be able to discipline yourself, motivate yourself, and regulate your activities. You'll still need to work toward goals, meet schedules, and plan for future.

Lack of continued effort is probably number one cause of failure in home businesses. Many, many people have desire, some have courage, but most still falter when it comes to getting work of building their own business done day after day.

It's going to take a while to get where you want, and it will take continued effort not only to reach your goals, but maintain that lifestyle once you've gotten there.

Working from home is NOT an occupation reserved for any sort of elite group. Others that have proven successful at it are no better than you, me, or anybody else.

It REALLY is possible to make dream of working from home come true. Yes, anyone can do it.

It's simply a matter of having an active desire, courage to make changes, and discipline to see it all through.

So, IS working from home REALLY for you?

Only you can answer that.

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Written by Joe Bingham of NetPlay Newsletter http://www.netplaynewsletters.com ------------------------------------------------------------------