Business Formation or Sole Trader??

[kamalbiggie]

Does one need to register as a sole trader or a limited liability company to sell items at the local sunday market in West London?

[Buenchico]

If you're simply using the market (like a car boot sale) to sell your personal possessions that you no longer want, you're not regarded as a trader - so there's no need to register with anyone.

If selling items that you've bought in for resale, the tax man will regard your activities as running a business, so you're obliged to register that business with HMRC.

There's never any requirement to operate any business as a limited company. (You could run a business as big as Microsoft as a sole trader or partnership if you wanted to - but it might be unwise!)

Chris

[kamalbiggie]

Thanks Chris

[resumedocket]

Easy to change: A sole trader business can be converted to limited company easily

Easy accounting maintenance: As a sole trader you can keep all the records of your financial affairs

Personal services: To attract your customers you can provide them personal service

Disadvantages of a sole trade business:

1) Business with greatest personal risk

2) Difficult to attract outsiders

3) You may find difficult to attract outside investments


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