How to check authenticity of a company

phill99

teneighty wrote: »

There is a body of opinion on this forum that sole traders are safer for customers than limited companies but I have never understood why.

It's to do with the legal status. A Sole trader is an individual in business. There is no legal difference between him and his business. All of his business assets (van, tools etc) are owned by him. If he does something that requires you to sue him, ALL of his assets are up for grabs including his house. If you employ a Ltd Company, this is an organisation that only exists in law. Its very common for Ltd Companies, if they are faced with legal action, to simply dissolve the company. This means the company has no assets at all. So if the judgement goes in your favour and they have been dissolved, you will get zero!!

Doozergirl

Furts wrote: »

Pure cowboy types are usually cash in hand, but here an invoice has been issued. This can still be a dodgy operator and the fact that the wrong sum was requested suggests this is so.

Good trades people do not make mistakes with invoices. And certainly not of this magnitude where the work has increased in value 3-4 times over. Dodgy trades will try it on at invoice stage - they only have to be successful now and again to make this try on worthwhile.

My guys make mistakes with their invoices *all the time*.

They're not trying it on, they just can't add up.

teneighty

phill99 wrote: »

It's to do with the legal status. A Sole trader is an individual in business. There is no legal difference between him and his business. All of his business assets (van, tools etc) are owned by him. If he does something that requires you to sue him, ALL of his assets are up for grabs including his house. If you employ a Ltd Company, this is an organisation that only exists in law. Its very common for Ltd Companies, if they are faced with legal action, to simply dissolve the company. This means the company has no assets at all. So if the judgement goes in your favour and they have been dissolved, you will get zero!!

That only works if the sole trader is daft enough to have any assets in his own name. Certainly any that are smart or dodgy will make sure anything of value is in the other half's name so you will still end up with nothing.

At least with a limited company you can see who the named officers of the company are, how long they have been trading and you can even see their annual accounts to assess their financial situation. It is not actually that easy to wind up a limited company and if there are outstanding liabilities the directors can be prevented from closing it down and even be held personally liable if they have breached their very strict duties as directors.

I suppose the moral is whoever you use, limited company or sole trader you have to do your homework to make sure they are a long established reputable business with good reliable personal recommendations. Not based on leaflets pushed through doors, online lead generating sites like Checkatrade or social media.