PROs and CONs of a Limited Company

A Limited Company is a form of a corporate structure available in other countries including U.K, Ireland and Canada. It may be set up as “private company”. Several advantages and disadvantages that one must consider when putting up a Limited Company. One major advantage is it features a limited liability, which protects its owners from repaying company’s debts, losses and legal claims. All of the liabilities incurred by the company are shouldered by the company itself and thus, not affecting its owners.  Another advantage is the investment and lending opportunities, where multiple owners are allowed. If there is a need for an additional capital, shares may be sold to a new investor. Additional funding also enable the company to expand new projects and improvements to the company.

However, there are also some disadvantages of a limited company like naming restrictions, statutory requirements and making the company records as public. The name of the limited company must strictly adhere to the guidelines – it must be unique and cannot be alike of an existing company. In addition, one must be full knowledgeable on the ins and outs of the UK statutory requirements such as tax return, dealing with the corporation tax and other mandated by the UK government for limited companies. Lastly, limited companies are required to register in the Companies House – which make it accessible to the public and thus, reduces the level of privacy of the company.