What is the difference between a sole trader and a limited company?
What is a Sole Trader?
Fundamentally, a sole
trader is essentially a self-employed person, who don't set up a limited
company and is the sole owner of your own business. They can think over to
employ other people but they are the only owner. It’s
very easy to becoming a sole trader
for starting a new business. All you have to do is register your business
name and you can start trading.
What is a Limited
Company?
- Private company limited by shares
- Public limited company
- Private company limited by guarantee
Sole trader or limited company
For most this is a choice between being a sole
trader and a limited company. When is the right time to incorporate your
business? Each structure has its own advantages and disadvantages for your
circumstances. You can compare the advantage and disadvantages of your business
structure that best suits you. No matter how it is big or small, but every
business has a legal structure. Here is a quick guide about sole
trader to a limited company.
In summary
Every business has its own structure and has no
right or wrong structure; it just suits the individual situation. Once you
have a complete understanding of the benefits, you can take an informed
decision and it’s upon to you. If you have started working as a freelancer or
sole trader, it is possible for you to wish to form a limited company.
If you are thinking over to set up and running
your own Limited Company and but not much aware about how and where to start,
you have come to the right place. Professional
accountants in South end on Sea works with both structures and often
advises individuals about which path to take. If you have a question or simply
want some advice, book a free consultation for further help and support.
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