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Lorrainelovesplants



Joined: 13 Oct 2006
Posts: 6453
Location: Cornwall
PostPosted: Tue Dec 02, 14 10:04 am    Post subject: business legal entity  Reply with quote    

Sorry, dont know what to name this subject - Ill explain.

If your business is as a sole trader, ie you are the business, can you still employ someone or does this mean you are then a company?

I need to know if I have to change the legal status of what I do if I take on a part timer.

Falstaff



Joined: 27 May 2009
Posts: 1014

PostPosted: Tue Dec 02, 14 10:12 am    Post subject: Reply with quote    

You can employ people all day long and still be a sole trader

vegplot



Joined: 19 Apr 2007
Posts: 21297
Location: Ynys Môn
PostPosted: Tue Dec 02, 14 10:43 am    Post subject: Reply with quote    

Search: business types legal definition uk

in your favourite search engine

Hairyloon



Joined: 20 Nov 2008
Posts: 14556
Location: Today I are mostly being in Yorkshire.
PostPosted: Tue Dec 02, 14 10:46 am    Post subject: Reply with quote    

But you will need Employer's Liability Insurance.

dpack



Joined: 02 Jul 2005
Posts: 32591
Location: yes
PostPosted: Tue Dec 02, 14 11:36 am    Post subject: Reply with quote    

and a basic understanding of paye /ni or accounting for them as sub contractors

either is fairly simple

Lorrainelovesplants



Joined: 13 Oct 2006
Posts: 6453
Location: Cornwall
PostPosted: Tue Dec 02, 14 11:49 am    Post subject: Reply with quote    

I already have employers liability.

I will take advice on PAYE etc - this is the stuff that has put me off for a while....

dpack



Joined: 02 Jul 2005
Posts: 32591
Location: yes
PostPosted: Tue Dec 02, 14 12:10 pm    Post subject: Reply with quote    

iirc it is fairly easy , they have a tax code and ni number,the amount they get paid and the tax code determine how much tax and ni should be paid ans the ni number makes sure it is recorded to their/your tax records

i think the tax office should have an "easy guide to paye/ni"

from what i remember it takes a few mins with a calculator and a few more to enter the numbers on the forms/in your accounts

tis probably all paper free these days

vegplot



Joined: 19 Apr 2007
Posts: 21297
Location: Ynys Môn
PostPosted: Tue Dec 02, 14 12:35 pm    Post subject: Reply with quote    

Lorrainelovesplants wrote:
I already have employers liability.

I will take advice on PAYE etc - this is the stuff that has put me off for a while....


That's straightforward if you have good software. I can highly recommend FreeAgent which not only manages invoicing, billing VAT returns, tax but also payroll.

Lorrainelovesplants



Joined: 13 Oct 2006
Posts: 6453
Location: Cornwall
PostPosted: Thu Mar 12, 15 3:51 pm    Post subject: Reply with quote    

Im asking another question now.....

As Ive been a sole trader for the last 10 years and the business is FINALLY turning around...Im thinking about if I should change its status.

Ive been told as a cider producer, it might make sense for me to become limited.
So LLP, partnership, Ltd - what are the differences and pluses and minuses.

dpack



Joined: 02 Jul 2005
Posts: 32591
Location: yes
PostPosted: Thu Mar 12, 15 4:01 pm    Post subject: Reply with quote    

ltd needs an audit every year which costs money ,however the amount it costs can be easily recovered by using the company to pay for things that a sole trader or employee has to buy from their own pretaxed money .

with good accounting advice and making use of the advantages on stuff you needed to spend out on anyway ltd can be a good way to trade .another advantage is that although most loans need security unsecured debts or liabilities are the companies problem rather than your problem if it goes toes up at some time .

the main disadvantage is paying for an audit and the need to get good advice re the best way to account for in and outgoings .there is usually a break even point on turnover/profits above which being a sole trader is not efficient.

vegplot



Joined: 19 Apr 2007
Posts: 21297
Location: Ynys Môn
PostPosted: Thu Mar 12, 15 4:49 pm    Post subject: Reply with quote    

Lorrainelovesplants wrote:
Im asking another question now.....

As Ive been a sole trader for the last 10 years and the business is FINALLY turning around...Im thinking about if I should change its status.

Ive been told as a cider producer, it might make sense for me to become limited.
So LLP, partnership, Ltd - what are the differences and pluses and minuses.


LLP's are primarily for solicitors and accountants. It is tax transparent i.e it doesn't pay corporation tax or capital gains that liability falls to the partners as self-employed persons.

vegplot



Joined: 19 Apr 2007
Posts: 21297
Location: Ynys Môn
PostPosted: Thu Mar 12, 15 4:52 pm    Post subject: Reply with quote    

dpack wrote:
ltd needs an audit every year


Small LTD companies are exempted from the need to have an audit but they do have to have accounts prepared by an accountant.

Quote:
Your company may qualify for an audit exemption if it has at least 2 of the following:
- an annual turnover of no more than £6.5 million
- assets worth no more than £3.26 million
- 50 or fewer employees on average

dpack



Joined: 02 Jul 2005
Posts: 32591
Location: yes
PostPosted: Thu Mar 12, 15 5:22 pm    Post subject: Reply with quote    

that has changed since my time ,we could do the books/accounts in house but they had to be externally audited.

i spose if the bookeeping is tidy getting the accounts drawn up by an accountant would not be too costly .
i recon shop around for some quotes .

sean
Downsizer Moderator


Joined: 28 Oct 2004
Posts: 41591
Location: North Devon
PostPosted: Thu Mar 12, 15 5:42 pm    Post subject: Reply with quote    

At LLPs level she prolly wouldn't need accounts prepared by an accountant either.

Ty Gwyn



Joined: 22 Sep 2010
Posts: 3947
Location: Lampeter
PostPosted: Thu Mar 12, 15 6:24 pm    Post subject: Reply with quote    

Ask Companies House to send you the relevant info on company types.

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