Registering a Business Name as a Sole Trader

blue_monkey_2

Ste_C wrote: »

It would make no difference. You don't have to be VAT registered if you're a Ltd company. It would still be £100 regardless of whether he's a sole trader or running the business as a Ltd company.


There are extra fees - annual returns at £15 per year, but it costs nothing to file annual accounts, unless you file them late in which case you'll be fined. There is also much more legal paperwork and other rules which must be followed. But he would not have to be audited and he would not have to use an accountant. There is no legal requirement for Ltd company accounts to be prepared by an accountant and a one man band doing painting and decorating turning over less than £68k would definitely not have to be audited!

She asked if it was better to be VAT registered and I was saying no, a local painter and decorator would be better value if a customer was not paying VAT as they would be cheaper.

My friend runs her own registered Ltd company, she told me that she HAS to be audited and she HAS to use an accountant to do this and she is not turning over a huge amount and that it is an absolute pain in the backside. That is why I cannot be bothered, I am happy running with 'trading as' however, I did express this incorrectly - it is my trading name and as far as I am concerned it is my 'company name'. It is what everyone looks for when googling me but I do not have a company number so I am not a 'registered company'.

I guess it depends, at the end of the day, what the OP wants, if it is just for the name then it is a lot more hassle and legal paperwork and there would be nothing to stop someone else using the same name unless it was a registered trademark anyway - and even then there would be nothing to stop someone else using the same name as the OP's hubby. The only way to stop that other person using that name is legally and possibly even through the courts which would cost an absolute fortune anyway. Does the OP have the money to start that fight?

I know someone that has the same business name as a large swimwear brand, she has the website domain for that brand as well and on asking permission to use that as her name she never got a reply so started using it. The legal fight to stop her using it has been going on for 2 years now and they have all sorts of lawyers on her case but she is still trading under the same name.

blue_monkey_2

Tozer wrote: »

Just to clarify the above posts, whilst you can have a business as a sole trader (or partnership for that matter), you cannot have a company as a sole trader.

You can have a "Trading name" both as a sole trader or as a company. By way of example, you could have a company called "XYZ Limited trading as "Great Painters".

The Companies Act 2006 requires various information to be put on all stationery (e.g. registered office, registered number, etc).

All private companies must end in "Limited" to demonstrate that there is limited liability.

Sorry, was the term I used - this is what I meant. It's half term and the kids are here.

Ste_C

blue_monkey wrote: »

My friend runs her own registered Ltd company, she told me that she HAS to be audited and she HAS to use an accountant to do this and she is not turning over a huge amount and that it is an absolute pain in the backside. That is why I cannot be bothered, I am happy running with 'trading as' however, I did express this incorrectly - it is my trading name and as far as I am concerned it is my 'company name'. It is what everyone looks for when googling me but I do not have a company number so I am not a 'registered company'.

I would get her to check things out. Did she get advice from an overeager accountant?

There's some more info here:

http://www.businesslink.gov.uk/bdotg/action/detail?type=RESOURCES&itemId=1073791917

Submitting audited accountants and using an accountant definitely have their own benefits, but they're far from compulsary for most small companies.

For many people in trades such as joinery, plumbing etc setting up a limited company is not much more hassle than running as a sole trader. Though with the changes in corporation tax rates the benefits are considerably less now than they were a few years back.

blue_monkey_2

She is an accountant so this is why I was confused. She told me she had to get her year end bits done and I said she could do it herself and she said no, she was not allowed to do this and another accountant had to audit her accounts. Maybe it is against the rules or something but this is what she told me so naturally I assumed that this is what had to happen, I apologise if I got this wrong.

Back to the name though, it would not stop someone using a business name and only a legal fight could stop it and it depends on whether the OP has the money to do just that.

Tozer

blue_monkey wrote: »

She is an accountant so this is why I was confused. She told me she had to get her year end bits done and I said she could do it herself and she said no, she was not allowed to do this and another accountant had to audit her accounts. Maybe it is against the rules or something but this is what she told me so naturally I assumed that this is what had to happen, I apologise if I got this wrong.

Back to the name though, it would not stop someone using a business name and only a legal fight could stop it and it depends on whether the OP has the money to do just that.

If she runs an accountancy firm then there may well be professional conduct rules requiring independence.

blue_monkey_2

No, not a firm, she works for a company doing the accounts but not an accounting firm, IYSWIM, but is herself an accountant. Too confusing. I am happy being a sole trader I do not think it makes a lot of difference to me, personally, I know someone else has my name but sells stuff totally different.

Actually, I also found recently that M&S used my 'company' (trading) name for one of their big lingerie campaigns - that can only be a good thing for me, right? :rotfl:

slipp_digby

Ste_C wrote: »

For many people in trades such as joinery, plumbing etc setting up a limited company is not much more hassle than running as a sole trader. Though with the changes in corporation tax rates the benefits are considerably less now than they were a few years back.

agree with Ste C

there is a myth that running a ltd company is hugely expensive and a lot of hassle. if it is set up well, this doesnt have to be the case and their are a range of exemptions to help small ltd companies.

seems to me that starting a ltd company just to stop someone else having the same name is the tail wagging the dog somewhat?

the OP would probably need to get the advice of a good accountant. the best way to do this is to prepare some projected costs and turnover figures to see if there is likely to be any benefit n sole trader vs ltd.

as for VAT, it doesn't mean you are a cowboy if you are not VAT registered it just means you will be able to quote competitively against larger companies who are VAT registered.you might be competing with cash in hand types though so potentially not a huge plus:D

not being VAT registered will reduce the burden of the admin required which might be important during the initial start up period!

if he is successful, he will need to deal with VAT eventually though (you hope):D

Ste_C

blue_monkey wrote: »

No, not a firm, she works for a company doing the accounts but not an accounting firm, IYSWIM, but is herself an accountant. Too confusing.

Far too confusing!

What I don't understand either is; who audits the auditors? And who audits the auditor's auditors?

Batchy

Tozer wrote: »

Just to clarify the above posts, whilst you can have a business as a sole trader (or partnership for that matter), you cannot have a company as a sole trader.

You can have a "Trading name" both as a sole trader or as a company. By way of example, you could have a company called "XYZ Limited trading as "Great Painters".

The Companies Act 2006 requires various information to be put on all stationery (e.g. registered office, registered number, etc).

All private companies must end in "Limited" to demonstrate that there is limited liability.

I agree with this... :-)

Batchy

Ste_C wrote: »

Far too confusing!

What I don't understand either is; who audits the auditors? And who audits the auditor's auditors?

Professional bodies ICEAW/ ACCA/ CIMA etc Audit the Auditors for professional practice carried out, and spot checks FILES/ JOBS. normally every 3 years, or more.

They have also all have professional indenity insurance in case of a claim

Professional Auditors Audit the other auditors Financial Statements and give an opinion so they can be filed at companies house if they are a company?? as auditors can also be professional practices therefore sole traders/ partnerships, self employed, LLPs, but they don't Audit the working case files, only the representation of the financial statements/ legal position of the company.

Hope this helps