Carer: Sole trader or Ltd company?

KCarter90

Hi all,

I'm hoping someone might be able to shine some light on my predicament.

I am currently seeking work as a self-employed care assistant and as per the advice of my accountant, doing so as a sole trader. I am seeking my work through Care agencies as they have an abundance of clients ready to go and for me, it's the best option.

Today I have been in contact with two agencies. The first agency (Agency A) is taking me on as a sole trader, whereas the second agency (Agency stated that I would need to be set up as a Ltd company and that most agencies will request the same.

It is my understanding that my accountant set me up as a sole trader because it's more beneficial for someone who has a 'small business'. However, it also benefits me to be signed up to several agencies as this would increase the available work.

So heres my predicament.... Do i stay as a sole trader which is supposedly more beneficial to small businesses? Or do i ask my accountant to set me up for a ltd company & increase my chances of agencies being able to take me on?

Obviously, I'm only human and want to work hard and make the most money i potentially can from this. So I do have this in mind when trying to come to a decision here

Thanks in advance!

Kyle

Andrea_jardin

You can do both.

Whether the accountancy fees will be worth it is another matter.

Really you need to talk to some other care assistants as I suspect either the accountant or the agencies are not representative.

Marcon

KCarter90 said:

It is my understanding that my accountant set me up as a sole trader because it's more beneficial for someone who has a 'small business'. However, it also benefits me to be signed up to several agencies as this would increase the available work.

It may be your understanding, but do you know why it is more beneficial? I can't think of a single reason why a sole trader would be a better bet than the protection of limited liability. Ask your accountant to explain their reasoning. 

oh_really

https://forums.moneysavingexpert.com/discussion/6105082/self-employment-benefits-for-agency-care-worker

AskAsk

check with a few more agencies to make sure that you do need a limited company to work for them.  the advantage of a limited company is that you can not be sued personally if you did something wrong as the company is liable and not you yourself.  it is more expensive to set up as a limited company as you need to set up the company first of all, then there is the annual company returns submission.  there is also the PAYE to deal with and dividends if these are paid to the directors.  so if you are using an accountant, it will be a little bit more expensive than the self employed route as the accountant has to do less for self assessment.  i don't think it is a huge cost though.

if your earnings are high, then setting up a limited company is worthwhile as there are tax advantages with earnings through a limited company over that of being self employed.

LittleVoice

AskAsk said:

check with a few more agencies to make sure that you do need a limited company to work for them.  the advantage of a limited company is that you can not be sued personally if you did something wrong as the company is liable and not you yourself.  it is more expensive to set up as a limited company as you need to set up the company first of all, then there is the annual company returns submission.  there is also the PAYE to deal with and dividends if these are paid to the directors.  so if you are using an accountant, it will be a little bit more expensive than the self employed route as the accountant has to do less for self assessment.  i don't think it is a huge cost though.

if your earnings are high, then setting up a limited company is worthwhile as there are tax advantages with earnings through a limited company over that of being self employed.

Sorry - incorporation is not a get out of jail free card.

AskAsk

info on how a limited company can give you protection
https://www.itcontracting.com/in-what-sense-is-your-liability-limited-if-you-run-a-company/