There’s lots to think about when you decide to run your own business, and it’s best to think about all these things before you start.
Most businesses register as a sole trader, limited company or partnership.
This also known as being self-employed and would include Construction Industry Scheme (CIS) sub-contractors. It is easy enough to be a sole trader, but you will have an unlimited liability for your business’s debts.
If you have a limited company you will limit your liability and protect your personal assets because it is a separate legal entity meaning that its finances are separate from your personal finances, but there are more reporting and management responsibilities.
You can set up the company yourself, but we offer a fixed price formation service and can even get the company formed within 24 hours.
A partnership is another form of self-employment, where two or more people to run the business together. You have joint responsibility for your business’s debts and would usually share the profits between you. A standard partnership, like a sole trader, can leave your personal assets at risk, but you can form a Limited Liability Partnership (LLP), which offers protection against certain claims against the partnership.
Partners in an LLP are known as members and accounts are prepared in a similar format to Limited Companies and have to be filed at Companies House. The ‘price’ of limited liability is the need to disclose financial information to the public.
Setting up an LLP is very similar to setting up a Limited Company, and again we
offer a fixed-price formation service.