Starting a new business? Get 40% off our accountancy services for 3 months! 😀

x

Starting a business is often a complex affair, with the main decision being whether to become a sole trader or set up as a limited company.

Sole Trader Limited Company
No legal distinction between you and the business. You will bear all the responsibility for the business, legally and financially. This could result in you losing your personal assets. A limited company is a separate legal entity to the directors, limiting the liability if things go wrong. Personal liability is typically restricted to the share amount of the share holders.
Any profits you make after paying tax are yours to keep. Any profits belong to the company, but can be shared amongst shareholders according to the portion their shares entitle them to. As a director, you can choose to pay yourself a combination of salary and dividends.
As a sole trader you can run your business with no requirement to make information available to the public. Limited companies must provide their annual accounts to Companies House, who publish them online.
A sole trader may find that the business credit rating is affected by their personal credit rating, which could make it difficult to obtain business finance. A limited company may find it easier to raise finance, as its credit rating is largely separate to its owners and directors.
Required to submit annual Self Assessment tax return. Might also be required to register for VAT and submit VAT returns. Company accounts submitted to Companies House. Corporation Tax return submitted to HMRC. Director’s payroll might also require PAYE. Directors also register for Self Assessment and submit annual SA tax returns.

View our online accountant services to learn more about how we help sole traders and limited companies with their businesses. To talk to one of the team, just call 020 3355 4047, or use the live chat button on your screen.

instant quotes for online accountancy

About The Author

Christopher Jones

Forensics graduate-turned copywriter and blogger. I love turning complex topics into easy to understand, yet engaging pieces of content.

More posts by this author
guest
0 Comments
Inline Feedbacks
View all comments

Read more posts...

June 2022 Client of the Month: Manea Kella

This month we spoke to Adrian Manea, architect and director at Manea Kella, a London based RIBA Chartered architecture and interior design…

Read More

Succession Planning for Business Owners: What Comes Next?

When you own a business, it’s extremely normal to feel like you’re surviving one day to the next – ‘winging it’, as…

Read More

The Accountancy Partnership – Our Positive Reviews

Here at The Accountancy Partnership, we’re proud of our customer reviews The reviews we receive from our customers show how hard we…

Read More
Back to Blog...

Confirm Transactions

The number of monthly transactions you have entered based on your turnover seem high. A transaction is one bookkeeping entry such as a sale, purchase, payment or receipt. Are you sure this is correct?

Yes, submit my quote
No, let me change it

Please contact our sales team if you’re unsure

VAT Returns

It is unlikely you will need this service, unless you are voluntarily registered for VAT.

Are you sure this is correct?

Yes, the business is VAT registered
No, let me change it

Call us on 020 3355 4047 if you’re not sure.

Bookkeeping

You only need this service if you want us to complete the bookkeeping on your behalf.

Would you prefer to complete your own bookkeeping?

Yes
No

Call us on 020 3355 4047 if you’re not sure.