Hi Folks For somebody that is starting to generate a decent regular online income together, what's the best route to go down... form a limited company or stick as a sole trader? What are the benefits / downsides?
This will depend on the regulations in your country. I'm not 100% sure but I think the following should be more or less universal. Sole proprietor: Very easy to start and close down from a legal point of view. All income belongs to owner Freedom from regulation Low startup costs Functioning is relatively simple and can easily be adapted to change [*]100% responsible for all liabilities (if you go bankrupt you can lose your personal belongings together with business assets) [*]Might have to pay higher taxes on income. [*]Credit worthiness limited to the assets of the owner [*]Limited existance if owner dies Limited company: Seen as a seperate legal entity, you won't risk losing personal possesions if the business goes under. Ownership can be transferred Might possibly pay lower taxes on income. [*]Need to have a registered accountant to do the financial records/reports. [*]Have to file for registration/pay registration fees. [*]Closely regulated
Thanks Crusader... I'm talking from a UK perspective... but it's really the same as you outlined here. Does anyone know any specifics that relate to web based businesses?