Sole Trader or Limited Company??

Voyager,

There is no right answer, but if you are opening a shop and taking someone on from the "off" I would generally suggest the ltd co. route as more suitable from a liability and tax saving point of view - you are obviously already making a very considerable commitment in this start up and the extra costs/fees etc of a company are probably not going to be such a big deal compared to (say) a web designer doing some work on the side of a day job when it would be a major factor.

That said, if you lose money in your first 6-12 months you will be able to get a tax rebate as a sole trader against old earnings that you won’t get as a limited company. It’s also a lot easier to deal with the admin etc.

I would have a chat through with your accountant as they should be able to give you some more specific advice relevant to your particular circumstances.

Hope that helps,

Regards,

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James Smith
Chartered Accountant
www.jamesesmith.co.uk
01235 536 773

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I just recently started with my business, but from what i know so far, i would say solo trader is the best way to go mainly because of tax purposes.
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