By Anna Jordan on Small Business – Advice and Ideas for UK Small Businesses and SMEs
You’ve finally mustered up the courage to wave goodbye to your boss and are now going solo. Surely you didn’t think this would be easy, did you?
As a matter of fact, many who have made the same choice know that this is just the beginning.
This is the time for a series of decisions to be made. You can take comfort in the fact that once your company formation is in place, each step along the way will be easier.
A key decision to be made when starting your own business, or becoming self-employed for the first time, is to decide what type of business structure you want to follow.
There are a number of options, all of which have their merits and differ in legal and taxation terms – but your four key options are as follows:
Sole trader
Partnership
Limited liability partnership (LLP)
Limited company
Simon Renshaw, director of AABRS, explains what you need to know about each.
On your own as a sole trader
By opting for the sole trader route, you and your business are effectively one and the same – from both a tax and legal perspective.
This means that you