This could mean either: it can’t pay bills when they become due; it has more liabilities than assets on its balance sheet Separate entity - A Limited Company is a legal entity in its own right. 1. Calculate your limited company profits with this calculator. One of the advantages of a public limited company is that, as with a private limited company, a PLC is set up as a separate legal entity, which means that you won’t be financially or legally liable for losses made by the business. Other advantages of a public limited company include: Wider financial input If you run your own limited company, there are two ways you can pay into a pension fund, both of which offer significant tax advantages. Contractors trade via a personal service company (PSC) because clients and … Contractors who trade via a limited company can use this calculator to calculate profit, corporation taxes and distributable profits for dividends. Once this is established the treatment of each type of loss is a little easier to determine. The income statement (also known as the profit-and-loss or P&L statement) details all of the company’s revenues and expenses — how much the company receives in sales and how much the company spends to make those sales.After all the additions and subtractions, the final tally tells you whether the company earned a profit or suffered a loss and how much. In the vast majority of cases, the directors of a limited company are not personally liable for the debts of the business, so any personal assets such as a family home would be perfectly safe. However, you may have some legitimate concerns if you have used a personally held property as collateral to secure a business loan. Here are some of the key ones: 1. What are the other benefits of changing from sole trader to limited company? You can opt to make personal contributions or make them through the business in the form of company pension contributions. A company is insolvent when it can’t pay its debts. By Lawrence Carrel . You’re not personally liable if your business makes a loss or if someone makes a claim against it The treatment of what you can do with the loss depends upon what source of income has generated the loss. Limited companies limit the liability of a corporate loss to the business and do not impact the private assets of owners or investors. Overview. Company losses are often complex areas of tax due to the detail involved in what you can and cannot do with the loss. Limited liability - In simple terms, if you run a Limited Company you are protected should things go wrong. Advantages of public limited companies. Assuming all rules have been followed, as a director you will not be personally liable for any financial losses made by the company. If My Ltd Company goes Bust will I Lose my House? There can be several benefits to switching to a limited company structure, taking into consideration yours and your business’s needs.