1. Information available to assist in setting up in practice
2. Guidance notes on the CLC procedure for processing applications for a full licence
3. Guidelines for applicants attending interview with the Licence and Practice Committee to apply for a full licence
4. Licence & Practice interview queries
5. Financial information
6. Guidelines for working from home
7. Preparing a business plan
8. Financial forecasting
9. An introduction to PAYE
10. Partnership agreements
11. Limited Company - Recognised Body
12. Statutory records
13. VAT
14. VAT do's and don'ts
15. Lenders' Panel Information
16. Queries

Should you consider it beneficial to discuss your application at any time with a member of the CLC staff, then you are welcome to do so, either by telephone or prior appointment at a mutually convenient time. The staff are able to offer help, support and advice, but they are not empowered to make a decision with regard to your application.

• Payment of the additional licence fee which will be calculated on a pro-rata basis by the CLC to year end, 31st October.
• Payment of any Compensation Fund contribution which may be required from you, calculated to the CLC year end, 31st October
• Satisfactory evidence of Professional Indemnity Insurance on the CLC Master Policy.
• A copy of the proposed practice notepaper to be sent to CLC for approval before printing.
• Notify the Council of details on a Practice Information Form of all bank accounts, the names, addresses and telephone numbers of your accountant, locum and the person holding the keys to your office who may be contacted in an emergency.
• Any other matters which the Committee may consider appropriate.

• Lenders may not be willing to provide panel appointments, but those that do may insist on an inspection of the premises to check on security, in particular whether there is a fireproof safe for deeds. The lack of panel appointments could mean the loss of business and your projections could suffer as a result. If independent mortgagees' conveyancers have to be appointed, clients may not consider the additional cost to be acceptable.
• In some locations Local Authority permission may be required and the property may also be subject to restrictive covenants which would prohibit commercial or business use.
• The Licence & Practice Committee would expect to receive detailed plans and photographs of the proposed business premises, to satisfy the Committee Members that there is, for example, a separate entrance and that the office was sufficiently detached from living accommodation to preserve client confidentiality. The Committee would also expect to be satisfied that there are adequate facilities for the security of deeds and clients papers.
• Women working from home should bear in mind the possible risk of inviting strangers into their home. Applicants with young families might also be concerned about the safety of their children with strangers coming into or close to the home.
• If an applicant has been accustomed to working in an office environment, it may prove difficult to adapt to the isolation that working from home creates.
• Some licensed conveyancers who work from home offer to see clients in the client's home, rather than invite a stranger to their own home. The question of security should be carefully considered, particularly for lone women. It may not be ideal to interview clients either in your home or theirs, although face to face interviews are of course desirable. An office environment tends to provide more security. The impression that working from home may give a 'cottage industry' rather than a professional practice.

• Taking prudent, calculated risks rather than blindly reacting to events
• Making the best use of available resources
• Setting a path to achieve the lifestyle you required

• What information you need to assemble
• The initial decisions to be made
• The sales and marketing options open to you

• Identify the key features of your business.
• Analyse its strengths and weakness
• Consider opportunities open to you and the threats you face

• Identify potential customers
• Characterise your clients and their needs

• Identify the features of your service
• Identify the advantages you have over competitors (i.e. on start up you may not be VAT registered)
• Identify your unique selling proposition

• Review the skills and knowledge needed to run the business
• Compare this list with the abilities of the people currently working with you
• If certain skills or knowledge are lacking, consider whether training would be appropriate
• It is often better to buy in certain skills as and when they are needed
• Other skills are needed constantly and should be available in-house

• Identify the relationship between price and profit
• Most businesses price low to maintain turnover but the additional profits from higher margins can often outweigh any loss of turnover
• Decide on the impact of competitors pricing policies

• Determine how you will attract potential clients
• Design the message and the medium required to evoke a response
• Prepare staff to service clients well, through training if necessary
• If you feel it necessary, prepare a separate, more detailed, marketing plan

• Take into account the anticipated turnover
• Make full use of marketing survey data
• Identify and estimate fixed costs
• Calculate variable costs

• Monitor your revenue and costs
• Manage the cashflow
• Manage people

• The degree of control and supervision exercised over the individual's work
• Whether services are performed mainly or wholly for one business
• Where the duties are performed
• Terms of pay, holiday time, pension arrangements, and other benefits
• Whether the work has to be performed personally or whether a substitute may be supplied
• Provision of items of equipment
• The financial risk and responsibility for loss undertaken by the individual

• Partner's duties
• Working hours and holidays
• Decision-making procedures
• Business premises
• Cars

• Profit sharing arrangements, drawings on account
• Partnership capital and interest arrangements
• Banking and financial arrangements
• Accounting arrangements
• Making provision for tax payments

• Partner retirement procedures
• Death of a partner
• Disability of a partner
• Establishing the right to expel a partner
• Arbitration for unresolved disputes

• Incorporation normally provides limited liability. If a shareholder has paid fully for their shares, they cannot normally be required to invest any more in the company. However, banks often require personal guarantees from the directors for borrowings of the company. Even so, the advantages of limited liability will generally apply in respect of liabilities to other creditors.
• A company enjoys legal continuity - it can own property, sue, and be sued.
• Effective ownership of the business may be readily transferred, subject to the provisions of the Articles of Association.
• Normally a bank can take extra security by means of a 'floating charge' over the assets of the company and this will increase the amount that can be borrowed against the assets of the business.
• Companies can re-invest profits after an effective tax change of no more than 20% (if profits are below £300,000) compared with 40% for higher-rate tax paying sole traders and partners.
• Corporate status is something thought to add to the credibility or commercial respectability of the business.
• A company can establish an approved pension scheme, which may provide greater benefits than self employed schemes
• Employees may with adequate safeguards, be offered an opportunity to acquire an interest in the business, reflecting their position in the company.
• The liability of executors acting for deceased shareholders or of trustees is clearly defined.

• Normally when you form a company you incur legal and administrative costs. The 1985 Companies Act requires that proper books and records be maintained. Annual accounts must comply with the requirements of the Act and the CLC Recognised Bodies Rules 2000 where a statutory audit is required. The statutory audit involves work over and above that which is normally carried out for a sole trader or partnership.
• A company's accounts must be filed on public view with the Registrar of Companies. An annual return must also be submitted to the Registrar together with a filing fee of £15.
• The company will be taxed on actual profits in each accounting period, as opposed to the current year basis for sole traders and partnerships.
• Cash withdrawn from a company normally gives rise to tax liabilities, whereas unincorporated businesses can generally introduce and withdraw cash without tax implications.
• Remuneration for directors is subject to both employees' and employers' National Insurance liabilities - currently up to 22.2%. For example, on a remuneration of £12,000 there is a NI liability of £1,734.
• Tax of directors' remuneration paid monthly is payable on the 19th of the following month through the PAYE system, and corporation tax is payable nine months after the end of a company's accounting period. For a sole trader or partnership, tax is generally paid by instalments on the 31st January in the tax year and the 31st July following the tax year. For example, tax for 1999/2000 is payable; first payment on account on 31st January 2000, second payment on account on 31st July 2000, with any final balance due on 31st January 2001. The 'credit period' depends upon the choice of accounting date.
• Companies pay tax on capital gains at their corporation tax rate (maximum 20% for profits up to £300,000). In a company, a capital gain is reflected in the value of its shares and if these are sold a 'double charge' to capital gains tax can arise. This may be avoided if assets that are likely to increase in value are owned either outside the company or within a self-administered pension scheme
• An individual has greater flexibility in dealing with trading losses.
• A company director is more at risk of criminal or civil penalty proceedings e.g. for late filing of accounts or for breaking the insolvency rules.

• Registration of shareholders
• Minutes of directors' and shareholders' meetings
• Register of directors and secretary
• Register of charges
• Register of directors' interests in shares and debentures
• Register of share or stock transfers
• Register of debenture holders
• Copies of directors' service contracts

• Registration of shareholders
• Minutes of directors' and shareholders' meetings
• Register of directors and secretary
• Register of charges
• Register of directors' interests in shares and debentures
• Register of share or stock transfers
• Register of debenture holders
• Copies of directors' service contracts

1. The applicant should hold a current licence.
2. You are required to complete an Application Form for a Limited Company Certificate of Recognition and remit the registration fee in the sum of £500.
   A contribution to the Compensation Fund of £100 is required in respect of each Director of the Company who is not a Licensed Conveyancer.
3. You are required to submit the relevant documentation set out in section 4 of the application for consideration by the Licence and Practice Committee.
4. You may be required to attend a Licence and Practice Committee meeting for interview. The interview will take the form of questions by the Committee members to discuss the details of your application and proposals for the future.

   Should you consider it beneficial to discuss your application at any time with a member of the CLC staff, then you are welcome to do so, either on the telephone or by prior appointment at a mutually convenient time. The staff will help, offering support and advice but they are not empowered to make a decision about your application.

5. A Limited Company Certificate will be issued, subject to the following conditions:
   • Advise the Council's Insurance Brokers of the change to the professional indemnity insurance policy and send confirmation to the Council.
   • Send a copy of the proposed practice notepaper to CLC for approval before printing.
   • Any other matters which the Committee may consider appropriate.

• An individual
• A partnership
• An unincorporated association, e.g. trust or charity
• A limited company

• Vatable turnover for the past twelve months exceeds £52,000
• There are reasonable grounds for believing that your turnover for the next 30 days will exceed £52,000.

• You must deregister when taxable supplies are no longer made, e.g. when trading ceases.
• You can deregister when anticipated turnover for the next year (measured from any time) is less than £50,000 but this may not be in your interests - week advice first.

• An identifying number
• The date of the supply and the date of issue of invoice
• The name, address and registration number of the supplier
• The name and address of the person to whom the services are supplied
• The type of supply by reference to categories e.g. sale, lease, rental etc.
• A description adequate for the purposes of identifying the services supplied
• For each description the extent of the services, the rate of tax and the amount payable, excluding the tax
• The total amount payable excluding tax
• The rate of any cash discount offered
• The total VAT payable.

• Names, address and registration number of the company
• Date of supply
• A description, adequate to identify the services supplied
• The total amount payable including tax
• The rate of tax at the time of supply.

• Do keep a monthly record of your turnover - late registration can result in severe penalties
• Do notify your local VAT office when major changes take place - changes must be notified within 30 days
• Do retain records for the last six years - these could be demanded by law
• Do obtain and keep VAT invoices - these are your authority to claim back VAT on supplies make to you
• Do charge VAT on any equipment or vehicles (except motor cars) that you sell or part-exchange
• Don't claim the VAT paid on the purchase of a motor car - it is not recoverable except in some very special cases
• Don't claim the VAT paid on goods or services used for private purposes. Where there is an element of private use ( e.g. telephone) an appropriate percentage should be claimed. Special arrangements apply to private use of petrol.
• Don't claim the VAT paid on entertaining
• Don't forget to account for VAT on inter-company charges
• Don't charge VAT on the transfer of a business as a going concern (make sure contracts incorporate appropriate VAT revisions).

If you have any queries or you require further information, please do not hesitate to contact:


Council for Licensed Conveyancers
16 Glebe Road
Chelmsford CM1 1QG Tel: 01245 349599

email: clc@clc-uk.org

...or you can contact us via our contact form.