Whatever your choice, you can be sure that with Pilbro, you will receive professional, practical business tax advice and expertise every step of the way.

Sole trader
This is the simplest form of business as it can be established without legal formality.  The sole trader is personally liable for business debts incurred.

Partnership
A partnership is similar in nature to a sole trader but involves two or more people working together.  A written agreement is essential so that all partners are aware of the terms of the partnership. Again, the partners are personally liable for business debts.

Limited company
A company is a legal entity in its own right, separate from its directors and shareholders.  A limited company can provide some protection from liability. This means that creditors of the company cannot make a claim against the directors or shareholders except in limited circumstances.  However, some creditors, such as banks, will seek personal guarantees from the directors.

Key Information
A new business must be registered with HM Revenue & Customs within 3 months of commencing to trade.

Sole traders and partnerships are self-employed and must complete a self assessment tax return every year; therefore, you will need to keep records of income and expenditure.  You will be able to deduct business expenses from your income in calculating the net profit on which tax is to be paid.  Profits must be calculated using accepted accounting practices.
If you want to send in a paper tax return, you must do this by 31st October; alternatively, you have until 31st January if you are submitting your return online.

Self-employed people must pay tax in three instalments.  The first payment is ‘on account’ by 31st January, and is usually half of your previous year’s tax bill.  You then have to make a second payment by 31st July, usually the same amount you paid in January.  Finally, on 31st January the following year you must pay a final balancing payment, calculated from your actual profits for the year.  If you have overpaid tax at this stage you will get a refund.
If tax is not paid on time, or your tax return is late, then additional charges to interest, surcharges and/or penalties may be payable.

Sound complicated? Let Pilbro simplify it for you.

Pilbro can help you with your record keeping if required.  We will also advise on tax deductible business expenditure and any allowances available to reduce the taxable profits, for example, capital allowances on any equipment you buy.