Starting Up

daparojo

Hi, I am hoping you can guide me.

I am currently employed and am looking to do some work as a consultant in my spare time.

My current employment is salaried, and PAYE is direct to HMRC. I also have Self Assessment set up as I pay extra into a DC pension.

At the moment, I am hopeful I can bring in over the 1k per year, aiming at around 5k per year to start off in my consultancy.

Do I need to register as a Sole Trader with HMRC despite having a Self Assessment already set up in my own name? If not, how do I register the company name with HMRC or do I not need to do that ?

I have a company name set up, and will need the relevant insurances to practice. If the insurance is in the company name, and the company is not registered with HMRC, could the insurance be nul and void ? 

Or do I set up as a Ltd company with Companies House despite having a low projected turnover and with very little financial risk for me individually (there will be no debts and very little assets).

Many thanks for your help.

Bookworm105

lesson one: learn when to use certain wording and what the difference means.

Sole trader including use of a trading name (eg: Fred Bloggs & Company) - an entity with zero legal standing, anything done in that name rebounds on you personally. There is no "company", there is only you.

A formal limited company (Fred Bloggs Ltd) - a separate legal entity divorced from your personal actions (subject to some caveats I can't be bothered to explain here)

Insurance for a trading name is personal insurance, not insurance for an entity that has zero formal legal existence

Insurance for a Ltd company covers the actions of that legal separate entity, not anything you do in a personal capacity

self employed with a trading name - read Become a sole trader: Register as a sole trader - GOV.UK (www.gov.uk)

Ltd company - get an accountant, you are out of your depth

Savvy_Sue

Also, before you get too carried away, check whether your employer requires you to inform them of any other work you are doing. 

DullGreyGuy

daparojo said:

Hi, I am hoping you can guide me.

I am currently employed and am looking to do some work as a consultant in my spare time.

My current employment is salaried, and PAYE is direct to HMRC. I also have Self Assessment set up as I pay extra into a DC pension.

At the moment, I am hopeful I can bring in over the 1k per year, aiming at around 5k per year to start off in my consultancy.

Do I need to register as a Sole Trader with HMRC despite having a Self Assessment already set up in my own name? If not, how do I register the company name with HMRC or do I not need to do that ?

I have a company name set up, and will need the relevant insurances to practice. If the insurance is in the company name, and the company is not registered with HMRC, could the insurance be nul and void ? 

Or do I set up as a Ltd company with Companies House despite having a low projected turnover and with very little financial risk for me individually (there will be no debts and very little assets).

Many thanks for your help.

You have mixed terms which makes it hard to answer, as noted above. 

There is no register of sole trader's trading styles (business name), given you already complete a self assessment you dont need to register but simply start filling in the self employment section. Bank accounts, insurance etc would have to be in your name but you can often add a trading style if you want (assuming you get a business account). 

A LTD is a very different set of answers because its a legal entity in its own right but it seems this isn't something you are seriously considering despite talking about "company" in the middle of the post. 

Danthenoble

First, check your employer doesn’t have something in your contract forbidding other employment. Start off unofficial self employed as sole trader until you get going. Limited company will incur fees and it’s not worth bothering until you have 20+ k per annum coming in. Just my opinion hope it helps. Good luck mate