Setting up as a sole trader / Go Self Employed

Being a sole trader is the simplest way to get started in business. Once you have informed the government agencies of your intentions to go self-employed, you can start trading right away (subject to any specific licences you might require in your line of work).

The beauty of being self-employed is how quickly you can get set up and in business.

Even if you are currently employed by someone else, you can also become a sole trader to run your own business in your spare time.

Sole traders

A sole trader describes any business that is owned and controlled by one person, although they may employ workers, eg a newsagent's shop. Individuals who provide a specialist service like hairdressers, plumbers or photographers, are also sole traders. Sole traders do not have a separate legal existence from their owner. As a result, the owners are personally liable for the firm's debts, and may have to pay them out of their own pocket. This is called unlimited liability .

Advantages

  1. The firms are usually small, and easy to set up.
  2. Generally, only a small amount of capital needs to be invested, which reduces the initial start-up cost.
  3. The wage bill will usually be low, because there a few or no employees.
  4. It is easier to keep overall control, because the owner has a hands-on approach to running the business and can make decisions without consulting anyone else.

Disadvantages

  1. The sole trader has no one to share the responsibility of running the business with. A good hairdresser, for example, may not be very good at handling the accounts.
  2. Sole traders often work long hours and find it difficult to take holidays, or time off if they are ill.
    3.  
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