Sole Trader or Limited Company?

jools002

As some of you may have read, I'm about to go self-employed and start my own company. I'm not sure what to do about registering my business with Companies House. Is there any extra benefit to be gained with regard to tax etc? Many thanks.

phill99

Need more info. Expected turnover, sector, employment of staff etc

Pennywise

There's an excellent (but long) thread over on the UK business forums which includes all the pros and cons etc. Well worth a read through.

http://www.ukbusinessforums.co.uk/threads/sole-trade-v-limited-company.60813/

CanadianExpat

There are all sorts of benefits to registering as a limited company, the ability to manage tax being a big one. The only downside, really, is the additional paperwork involved. If the business is large enough to be your primary source of income, my guess is that you'll want to incorporate. The link someone posted above is a good one.

chalkie99

Having read that you are going to be a start up dog groomer then I would think you will have no tax benefit from setting up a Limited Company.

However, a far better reason to do so would be to protect your personal assets (home, etc.,) in the event that someone sues you for
losing or harming their prize pooch.

They would have to sue the Limited Company so you can greatly limit your losses. There is a little bit more to the paperwork, though not a huge amount, and you will need an accountant, but it may be worth weighing up the consequences of a personal lawsuit against you if you remain a sole trader.

Percy1983

chalkie99 wrote: »

Having read that you are going to be a start up dog groomer then I would think you will have no tax benefit from setting up a Limited Company.

However, a far better reason to do so would be to protect your personal assets (home, etc.,) in the event that someone sues you for
losing or harming their prize pooch.

They would have to sue the Limited Company so you can greatly limit your losses. There is a little bit more to the paperwork, though not a huge amount, and you will need an accountant, but it may be worth weighing up the consequences of a personal lawsuit against you if you remain a sole trader.

Well this is the benefit of the limited company.

On the flipside surely you can just take out insurance for this sole trader or limited company.

From the sound of it you are starting small, so I would go sole trader as it makes the paperwork much easier as well as being much easier to stop if deemed not a viable business, you can always switch to a limited company later if/when it grows.