The document provides an introduction and background about Peacock Carter Limited, a digital agency founded by Michael Peacock and Richard Carter in the North East of England. It details how the founders previously ran separate sole trader businesses before forming a partnership and later incorporating as a limited company. The reasons for incorporating included becoming a full-time business with employees, higher turnover and more services which increased risks that a partnership could no longer appropriately manage.

1. Peacock Carter Limited Company Introduction for Kings Academy

2. Who we are Michael Peacock – Director Richard Carter – Director

3. About Peacock Carter Digital Agency based in the North East Web design Web development E-Commerce Search Engine Optimisation Hosting / Email provisions

4. Our beginnings Both directors previously ran separate businesses as Sole Traders Formed Peacock, Carter & Associates as a partnership Incorporated as Peacock Carter Limited

5. Sole Traders Before forming Peacock Carter, we both owned our own independent businesses No employees Part time Low turnover / low risk (high personal risk if something were to go wrong) “Freelance” Setup and accounting free (DIY!)

6. ... As sole traders The business = the sole trader (though can have employees) Unlimited liability Personal drawings and salary = profit Income tax payable on profit above personal allowance (incomes over ~£6,000)

7. Forming the partnership For dual ownership – needed either Partnership or Limited Company (or Limited Liability Partnership) Business was still part-time, low-turnover with low risks – partnership quickest and easiest Setup and accounting still free (DIY!)

8. ... As a partnership The business = the partners Unlimited liability Jointly and severally Each partner is liable within the partnership, regardless of partner at fault Personal drawings and salary = profit Income tax payable on profit above personal allowance (incomes over ~£6,000)

9. Why incorporate? Became a full time business Higher turnover, more clients, more services, employees, and more risk Plans to take on employees Profit sharing / share ownership scheme for employees? Partnership was no longer appropriate

10. Incorporating Costs to setup (Registration with companies house) Costs to file documents (Annual Returns) Compliance – accounting more in-depth Profit taxed directly (corporation tax) Shareholders can take salary as “dividend loan” out of profits – without the need to pay tax personally on such incomes under ~£30,000 Accountant!

11. Limited Company Cheatsheet

12. Other Options? Charities Unincorporated Incorporated Trustees can’t take money from charities! Community Interest Companies: Limited companies Limited Liability Partnership: Similar to Limited Companies with some attributes from partnership carried over

13. How to decide? Look at Risk vs Reward How many people are involved How does ownership need to work

14. Our risks Client emails go down Use third party email service Website goes down Contracts with clients / suppliers E-Commerce website stops processing orders Contract with client / Insurance policy

15. What other risks? What other risks do you think we have? How can we mitigate the risks