head bolt is correct in my experience at least
The word is INTENT, and any one can set up a limited company, and VAT registered in UK, and provided they trade with the intention of making a profit, then they are clear.
I had a run in many years ago with IR in regard to Benefit in Kind. They decided that I as a director of a (profitable) ltd company was using the business flying that we conducted in the "company" owned and operated aircraft, was a BIK to me, as I was the pilot, and thus getting flying for free, which otherwise would have been out of taxed income.
We were able to point out that by my piloting rather than hiring an outside person we as a company saved money, and also the aircraft was able to be a capitalist tool and assist in our exports we were actauly good boys. They went away.
I was not looking forward to my next IR renewal invoice being audited.
Glf
ps the Gas Man has almost as much power of entry as the VAT Man, I also suspect the RSPCA is as powerful!!!!!