One of the biggest
decisions a budding entrepreneur or businessman
has to make is to decide what kind of company
structure he envisions for his future business.
Sole Proprietorship (trader) and a
Partnership....
....are both forms of self-employment. A
partnership basically means that there are two
or more people who claim ownership of the
business. Both these options are considered the
simplest methods in which to trade. Based on UK
law, a partnership or sole proprietorship must
keep all their invoices and receipts for six
years as well as keep a detailed record of the
money that was earned and the money that has
been spent for the business. Additionally, a
Personal Tax Return must be filed at the end of
the tax year. The said income and expenses will
then be declared at this point.
To register a Sole Proprietorship form SA303
must be completed. This form can be downloaded
at:
http://www.hmrc.gov.uk/startingup/register.htm
Being self-employed businessmen who enter into
these two discussed options must pay their own
self assessment tax and National Insurance
contributions. Businessmen who undergo these
tasks must be able to show details of their
income, gains, reliefs, and allowances. A
faithfully kept record will make these tasks
easier.
It is recommended that business owners who enter
into a Sole Trader/Partnership, unless their
income is very small, should hire an accountant
to perform these tasks in their behalf. It may
be considered an expense but a good accountant
can end up saving the company more money.
Tips and
guidance on setting up your new company
If you have any questions and wish to book a
free no obligation consultation, call us now on:
Tel: 01277 725252
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