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2. Prepare to get scr*wed on tax [webmasterworld.com] like [almost] nowhere else on earth.
(The published Corporation Tax figures etc don't tell half the story. Many small business owners pay 90% of what they earn in a variety of different taxes)
3. Get the advice of a good accountant.
Angelis - The UK now has the ability to register LLC's (we can also register Ltd companies here, but they are different)
I always thought that having a business had tax ADVANTAGES rather than disadvantages (rich dad/poor dad) is this incorrect?
Incorporation has the advantage of the Limited Liability bit i.e. when the business doesn't work out your creditors lose money, not you. Your creditors write off the amount as a bad debt, they don't make you homeless. And for the privelege of the Limited Liability protection you'll jump the hoops, pay CH their annual filing fee, pay an accountant (or auditor... depending on level of T/O), pay VAT at 17.5%, pay PAYE (euphemism for Income Tax) at 40%, pay both employer and employees' National Insurance Contributions - not a "tax" ;), not pay your spouse a salary [google.co.uk], and pay Corporation Tax on what little is left after the IR have finished with you. Any big purchases you make in the company name are likely to be subject to Stamp Duty (note, again, it's not called "tax") and when you sell them you'll likely pay CGT. When you die your kids will pay IHT on what's left.
True, some of these taxes are payable even in you aren't incorporated but this maybe a good time to assess offshore registrations. It may be too late in a year or two.
Going LLC is cheaper than some options ... but not cheaper than going off-shore ;)
I wouldn't take casual advice about going off-shore. Invest in research, read the websites, signup to the fora, subscribe to the specialist magazines, and take your time deciding. If you pay someone for advice in this matter - pay cash, it's less traceable. Even if you're doing nothing illegal... don't leave traces.