Changing from Ltd Company to sole trader

[Yodel]

I am planning on switching back to trading as a sole trader (currently running the business as a limited company). When calculating the rolling turnover of the sold trader business to see if it's over the VAT-registration threshold, should I take in to account the past turnover from the limited company, or am I effectively re-starting from zero? Thanks.

[buildersmate]

I think you are going to have to ask the VAT-people.
I couldn't find anything in their guidance that covers this - they only mention if you take-over an existing business.
http://customs.hmrc.gov.uk/channelsPortalWebAp p/channelsPortalWebApp.portal?_nfpb=true&_page Label=pageVAT_InfoGuides&propertyType=document &id=HMCE_CL_000086
I suspect that you restart from zero.

[Markandshez]

The Limited Company is an entity in its own right and you are an employee of that company.

If you decide to set up in business as a sole trader you are starting from scratch. You will, effectivly, be nicking the customers from your previous employer - something most people do when they start a business. That may cause the Limited Company to go out of business - which will happen in your case.

So, bottom line is, you start from scratch.


Make sure you close your Limited Company down properly.

[Yodel]

Many thanks for the helpful advice. Yo.