Canon Photography
Registered company?
As I have sold a few photographs and had a few published so far,
am I wondering whether I should set up a registered company.
The plus point in this ( I am assuming) is so I can claim Vat back on any equipment purchases I make in the future.
I dont think its costs very much to set up a company so are there any negatives?
(I am guessing there must be some or everyone would have a company set up.)
Like is there limits as to how much profit you need to make a year or can you just plod along breaking even?
More importantly is it fraud if you set up a company and dont sell anything? (Thinking worst case scenario).
Thanks
Pete.
Hi Pete,
My simple answer is I find it easier just to let the taxman know I intend to make at least some money from photographs and have a separate personal account for any transactions. Also keep any receipts for kit purchased, processing, travelling, etc to offset against any tax you may incur. This way you only have the tax return to complete each year.
I personally feel it's only worth going down the company route if you think you are going to be able to make a full time living. Banks charge fees for transactions on business accounts, also you will need an accountant and have your accounts audited every year… Plus all the extra paperwork of course.
Others here may prefer the company route & hopefully we will see more replies.
Almost forgot to add that your photographs are your intended products, so you would be trying to sell something just like any other company. Of course if you have all the costs and no sales then you go bust. Tax evasion if you sell and don't tell the tax man is the one to watch out for 
Hope this helps for now ... Tony
Pete,
I certainly am not acquainted with the laws where you live, so can only talk about them as they pertain to USA.
Any person can start a company and lose as much as they want for as long as they want. There are people here with lots of money who do that just for the tax advantage. Of course, everything has to be on the up and up in all respects. If you never sold anything, then sooner or later our IRS would question if this was just a company set up for you to write off your equipment. But you said you have sold a few and had a few published, so it could be workable. If you were here, the best advice I would be able to give you is to talk to a reputable accountant about the feasibility of doing this. Here a business does not necessary have to be audited, and many small businesses are not and do all the accounting work on their own.