Setting up as a sole trader can be simple and inexpensive but with it comes a lot of responsibility.
As a sole trader there is no differentiation between your personal assets and those of your business. So if your business doesn't go well you could get into hot water...
We can offer help, guidance and services to reduce your risks, ensure your accounts are in order, help with strategy, business planning and even basic contracts. All of this at an affirdable cost from experienced professionals. That's why we set up Accounts & legal - as we know that sole traders and small businesses don't just need accounts.
To fully ensure that you understand what is expected of you as a Sole Trader you will have to have a firm grasp of the Self Assessment process and what is expected of you.
You will have to register as self employed with HMRC. You will then receive a Unique Tax Payer Reference.
As a Sole Trader you may be able to manage your own bookkeeping but Sole Traders are notoriously busy people and if you do not have time you might want to call in the professionals to help you stay on top.
Many business owners find it hard to let go of tasks but by working with the right people, outsourcing can free up the time you need to work on developing your business.
Even as a sole trader if you are turning over more than £79,000 you are still obliged to pay VAT.
Some business owners who aren’t turning over more than the threshold can voluntarily register for VAT. Contact us for more information about VAT and why and when you should register.
It is important for a sole trader to be insured as the owner of the business will be held personally liable for any defaults or legal claims.
Equally, incapacity insurance can help mitigate the financial impact of sickness or injury. Arguably, it's much more important to get this in place if you are self employed, since employees of a company often have a sickness policy which means that there is less chance of your income disappearing over night.
You don’t have to be a sole trader forever. If you get to a stage where you think it could become financially beneficially to incorporate then explore your options. Use our 60 second quiz to find out if this might be better for your business status.
We work with sole traders and limited companies. We can help with self assessment and VAT and we offer a company formation package for when you are making the transition from Sole Trader to Limited Company.