The answer is that from a tax point of view, it is advantageous to trade through a limited company as long as income is drawn from company by owners as dividends from their shares and amount of dividends drawn is restricted below 40% band rate (i.e. œ31,063 for tax year 2002/03). That way, owners have no further personal tax ("income tax") to pay. Moreover, dividends are not subject to national insurance contributions. This is excellent news of course. But, if dividend income falls within higher rate bracket of income tax (i.e. above œ34,515), they will be taxed at 22.5% on excess, which of course will increase tax burden. The company profits are subject to corporation tax rates. Those are lower than income tax rates.

The most catastrophic scenario is when director takes his reward from company as salary. Then his/her salary is taxed at income tax rates (like a sole trader's income). That is because, unlike sole traders, tax system treats companies as separate from their owners because a company is a separate legal entity. The problem is that income taxes are higher than corporation tax rates. On top of that, they will be subject to employee and employer national insurance contributions, which of course increase tax burden and render his position worse than even an unincorporated business ("sole trader"), because NIC Class 1 on payroll are higher than NIC Class 2 paid by self employed.

In contrast, a self employed person ("sole trader") is taxed at income tax rates on profits from his business, which are added to his other sources of income. As it has already been mentioned, income tax rates are overall higher than corporation tax rates. On top of income tax, national insurance contributions class 4 are payable on business profits within a specified band (7% on profits between œ4,615and œ30,420). National insurance contributions Class 2 are also paid by self-employed people, although those are lower than those payable by company directors on their salaries.

To illustrate above, let's take a simple example. We have a limited company and a sole trader. They both make œ60,000 profits each in tax year 2002/03. We assume that company director takes a salary equal to amount of his personal allowances (untaxed income) of œ4,615 and balance as dividends. The company will pay corporation tax at 19% equal to œ10,523 and nothing else. The sole trader will pay income tax œ16,542, National insurance Class 2 œ104 and National insurance Class 4 œ1,806. Total œ18,452. The bottom line is that person that has incorporated his business into a limited company will make a tax saving of œ7,929 compared to a sole trader! Isn't that fantastic?

Somebody might be wondering: why is this entire happening? The official explanation is that, this government, to help economy grow, encourages people to leave as much profits within their businesses to be reinvested, instead of being taken out and spent.

1. Print a team's sports schedule on back. Fans will keep them handy and keep your name in front of them

2. Print a special discount offer or coupon on back. People will keep it because they intend to use coupon.

3. If you do seminars, print key principals on back. Your attendees will refer to them later and think of you.

4. Hand write on back your "unlisted" 800 number. This adds value to your card, making people keep it longer because they don't want to lose special number.

Ad Specialties

5. Make business card ad specialty: Print your company information on letter openers, CD openers, magnets, pens, highlighters, keychains, mousepads, mugs, luggage tags, and other items that people will keep because they are useful.

6. Attach a business card to an ad specialty: For example, give business card holders as a thank you gift and place your business card in as first one. Or, have your card designed as a Rolodex card

7. If you routinely give out seasonal gifts or specialties, attach your business card. Examples: candy canes at Christmas, heart shaped containers filled with candy for Valentine's Day, or even a sandwich bag of candy with a card stapled to it.

Unique Places to Put Them

8. Tuck them into product before delivery: If you are a florist, cut a hole in it and tie a ribbon around flowers and through business card. If you sell gift baskets, Tuck one inside basket before delivering it to your customer. The same goes for Mary Kay or Avon Cosmetics - place your card in bag. You've seen how some restaurants staple a menu to their bags for takeout; if you use bags, staple your card to outside of bag.

9. Send a business card in every piece of correspondence - letters, invoices, even your electric bill. Sooner or later, those cards will be used.

10. If you are crafty, incorporate them into your designs: embellish them with rubber stamps, or blend them with other art projects. You can also mount them to greeting cards you create and send to customers and prospects.

11.When mailing out information: Take a number 10 envelope, facing you and upside down. Fold envelope in thirds. When you turn it around, there is a little pocket to tuck your card in. Include it in mailing. Using a colored envelope makes presentation even more dramatic.

12. Scan your card in and use it as a graphic for when you exchange links with other websites. The other site can use your graphic as link.

13. Place them in library books as if you used them as bookmarks. Visit bookstores place them in books related to your business.

Keeping Them Handy:

14. Use them as bookmarks so you'll always have some readily available if you meet someone at school, in library, on bus, or at park where you like to read.