Sole Trader Benefits
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Setting yourself up as a sole trader can be a great way to start up in business. There is not much administration and there are no set up costs for registering at Companies House. It is the quickest and simplest way to get your business up and running.
What are the benefits?
Whilst setting up a limited company may ultimately be a more tax efficient means of operating, setting up as a sole trader is much simpler, requires a lot less administration, and costs less to run. The ease with which a sole trader business can be set up presents a number of advantages.
- Total control - As a sole trader you are your business, and you are in full control. You are responsible for all decisions without having to consult other directors or shareholders, so you can develop the business exactly how you choose.
- No set up costs - There is no need to register your business at Companies House, so the paperwork is very simple, you do not require the services of a solicitor or a formation agent so there are no fees to pay. Simply inform HMRC that you are self-employed.
- Privacy - Unlike a limited company, where all information concerning the business, including directors details and annual accounts are made public, information about sole traders
is kept totally private.
- Capital allowances - If you need to purchase equipment for your business, for example vehicles, tools, IT equipment or business furniture, you may be able to claim tax relief on these purchases in the form of capital allowances.
- Flexibility - Because you are the sole decision maker, it is much simpler to adapt your business to the changing demands within the market you serve. You can change prices and vary services, making decisions quickly and acting on them swiftly, keeping you agile and competitive.
- Simple accounting - Although you must maintain detailed records of invoices, expenses and accounts and file an annual tax return, the actual accounting process is much simpler for a sole trader than that for a limited company.
- Profit retention - As a sole trader you retain all the profits of the business.
Get the right advice
If you would like to understand more about your working options and how they affect you financially and the levels of day-to-day responsibility then you will find our free, no obligation consultation and take home pay illustration really helpful.
Simply tell us the sector you work in, your annual income or agency rate, hours per week and any business expenses you incur - and we'll do the rest!
Free Working Options guide
Our free guide is a great starting point if looking to work as a Sole Trader or Limited Company and want to quickly cut through the jargon to help you understand everything you need to consider.
Download Our FREE Guide
"From the very beginning, I can only say that I have been 100% satisfied with the services I have received from Brookson. Starting a new company was quite unnerving at first, however Brookson have assisted and guided me along every step of the way, providing an excellent & impressive range of continually evolving services. I would thoroughly recommend Brookson to both new or experienced contractors – the service they provide is second to none.”