Ltd Company -v- Sole Trader

[Alien]

Hi all

I'm considering either setting up my business (in my particular niche, not as a domain pro!) officially. I'm fed up working as an employee and want to be my own boss.

Comparing between Ltd Company and Sole Trader differences/advantages at the moment and reading up on this. It's a learning curve!

May I ask, if people are willing to share this, are you either a Ltd Co or Sole Trader and if so, what made you choose to be either?

Any insight welcome, thanks!

 

[aZooZa]

I have both. I would suggest that unless you have a complicated equity structure, or you need some kind of formal liability protection, you take the sole trader route. Much less aggravating paperwork

 

[Alien]

I have both. I would suggest that unless you have a complicated equity structure, or you need some kind of formal liability protection, you take the sole trader route. Much less aggravating paperwork

Thanks aZooZa - I'm leaning towards this I think.

 

[wb]

What's your niche? That may affect recommendations, however from experience registering as self employed is extremely simple and requires minimal time/cost to run as a business.

 

[techtimmy]

I've just signed up for a Sole Trader last week. I think that's all you really need in the early stages of the business. Can always change later.

 

[orchardapple]

my advice is to speak with an accountant, not just as simple as filling a few forms in, calling HMRC, an accountant will go over your business, how you are looking to run it, tax implications, running costs etc.

Could even advise you against setting the business up if things dont add up.

Pretty much all the accountants i've spoken to offer an initial session for free.

 

[aaclapham]

I would start off as a Sole Trader but open a separate bank account for the business.

Once your earnings take you into the 40% tax bracket or you have to start paying VAT then its time to think about forming a limited company. At that point I would suggest getting an accountant.

I was a sole trader for 3.5 years and now have had a limited company for just over a year.

Hope this helps.

 

[orchardapple]

I would start off as a Sole Trader but open a separate bank account for the business.

Once your earnings take you into the 40% tax bracket or you have to start paying VAT then its time to think about forming a limited company. At that point I would suggest getting an accountant.

so you'd waste 000's in unnecessary tax/NI then just not to go ltd from the start?

 

[aaclapham]

so you'd waste 000's in unnecessary tax/NI then just not to go ltd from the start?

So what advice would you give then?

 

[orchardapple]

So what advice would you give then?

my advice is to speak with an accountant, not just as simple as filling a few forms in, calling HMRC, an accountant will go over your business, how you are looking to run it, tax implications, running costs etc.

Could even advise you against setting the business up if things dont add up.

Pretty much all the accountants i've spoken to offer an initial session for free.

nuff said tbh, have to consider salary/dividends options inc best level of salary to take, taxation advice, expenses, start up costs, when to reg for VAT etc

You'll be pleased to know i've spoken to several accountants for the companies I run and sure am glad of the advice and guidance, well worth the time and expenditure, as you need to think of the cost of running the company (accountants fee's etc) and the value of the advice you get which often offsets the accountants fee's.