Are you someone wondering how to start a business in UK? Well, first thing first, you must select the right business structure. Usually in the United Kingdom there are two specific business structures such as sole trader and limited private company. People from various parts of the world or who are new in business upfront usually get confused while choosing the right business structure. To make your life easier here in this informative article you will get to know about the right business structure that you can choose according to your business requirement. So what are we waiting for? Let’s see the difference between sole trader and Limited Company.
Understand The Sole Trader Business Structure
So first of all let’s understand the most common business structure of the United Kingdom. This business structure is specifically designed for non-UK business enthusiasts who want to start their small but viable business in the United Kingdom. The advantage of this business route is; it is super easy to register your business as a sole trader because it requires less documentation.
This structure provides you full control over your business just like a UK Self sponsorship visa. This route does not involve heavy tax obligation. However, if you choose this structure you have to do everything on your own and your personal assets might be at risk. This structure can limit your professional growth if your business fails.
Understand The Limited Private Company Structure
This business structure is curated for high net worth business professionals. It is one of the popular business structure choices who want to expand their business roots in the UK. This business structure is usually preferred by already established companies who want to open their other branch in the United Kingdom. This particular structure can be the safest option as it does not involve your personal assets you can use your company’s finances.
However, the tax slab for this business structure is typically higher. As a limited private company this structure provides your business an ultimate exposure to the global business front. Through this business structure it can become easier for you to attract potential customers. If we talk about the cons of this business structure, the registration process can be really complex. Since, this structure provides exposure to your business it will remain always there in the public domain. Hence, it can be a challenge to control damage in the situation of breakdown.
Now on the basis of this comprehensive comparison between these two business structures you can choose one as per your business requirement. The major point about this is that when selecting a business structure you must consider your budget first and then choose a structure as per your financial situation.
In conclusion, we can say that both these business structures are designed for different business plans but it is essential to choose according to your own requirements. Select a structure that suits your business plan.
