Managing Finances: Running a Limited Company in the UK

Managing Finances: Running a Limited Company in the UK

Learning Objective

At the end of the lesson, you will understand the accountancy tasks involved in running a limited company in the UK.

What do you already know about running a limited company in the UK?

Overview of Limited Company

A limited company is a separate legal entity from its owners, offering limited liability and tax advantages.

Registering a Limited Company

To run a limited company, you must register with Companies House, providing details of company directors, shareholders, and the company's registered office.

Accounting Records

Maintaining accurate accounting records is essential, including income, expenses, assets, liabilities, and any financial transactions.

Financial Statements

Limited companies must prepare annual financial statements, including a balance sheet, profit and loss account, and notes to the accounts.

Taxation

Limited companies are subject to corporation tax on their profits, and directors may also need to pay personal income tax on their salaries or dividends.

VAT and PAYE

Depending on the company's turnover and employee status, it may be required to register for VAT and operate a Pay As You Earn (PAYE) scheme for employees' tax and National Insurance contributions.

Interactive Task: Financial Recordkeeping

Students will categorize sample financial transactions into income, expenses, assets, and liabilities, reinforcing the importance of accurate recordkeeping.

Conclusion

Recap the key responsibilities and tasks involved in running a limited company in the UK, emphasizing the importance of proper accounting and compliance.

Write down 3 things you learned in this lesson.

Have students enter three things they learned in this lesson. With this they can indicate their own learning efficiency of this lesson.

Write down 2 things you want to know more about.

Here, students enter two things they would like to know more about. This not only increases involvement, but also gives them more ownership.

Ask 1 question about something you haven't quite understood yet.

The students indicate here (in question form) with which part of the material they still have difficulty. For the teacher, this not only provides insight into the extent to which the students understand/master the material, but also a good starting point for the next lesson.