Steps to Becoming a Sole Trader?

[peter hh]

Hi i am starting up a new Business as a Sole Trader and am wondering how to go about it.

It seems really easy to become a Sole Trader a little to easy, this is how i think you become a Sole Trader, plz tell me the right steps if i am wrong thanks!

1-Decide on what your Business will sell and what it will do.

2-Think of you'r Business name.

3-Register as self employed.

4-Open a Business Bank account

5-Register for VAT if income is over £60000

Is that it???

[Eric Mc]

See steps outlined in the thread two threads below this one.

The compulsory VAT threshold is now £61,000.
There is no legal requirement to have a business bank account although you may want one anyway.

[J1mmyD]

Don't.

Get yourself a limited company - £85 gets you a shelf company.

Trust me .... I speak from experience. Even though I'm back up and on my feet now it's 6 years that I'd rather have done differently.

[Eric Mc]

It's not that simple. I would steer clear of setting up a limited company unless you are absolutely clear that it is the correct and appropriate thing for YOUR business and your circumstances.

Getting an accountant on board should be an early priority.

[peter hh]

Eric Mc said:

See steps outlined in the thread two threads below this one.

The compulsory VAT threshold is now £61,000.
There is no legal requirement to have a business bank account although you may want one anyway.

So i take it that my steps are correct?

They just seem so easy.

[J1mmyD]

Eric Mc said:

It's not that simple. I would steer clear of setting up a limited company unless you are absolutely clear that it is the correct and appropriate thing for YOUR business and your circumstances.

Getting an accountant on board should be an early priority.

Eric is, of course, entirely correct. Just be aware of the pitfalls of both options before continuing. Don't let my bad experience put you off, but please learn from it (someone might as well). As a sole trader, your liability is not limited. If things go wrong, you'll find that out fast. Take advice and good luck.

[peter hh]

I Take it my steps are correct?

I do plan to go Limited but not for a while yet, one reason of becoming a Sole Trader is that there is less paperwork.

Question.
If i mess up and become liable for say £10000 but i do not own my property i rent, and have not many possesions how else whould they get there money?

[Eric Mc]

Try not to mess up.

Most people start off their businesses as sole traders and graduate to limited company if they feel the added security of limit3ed liability is warranted.

Your steps are more or less correct. Why shouldn't they be easy?

[magic torch]

I'm a sole trader as well as owning limited companies. There'll be a set-up that suits you best.

A lot of organisations from HM Revenue & Customs to Accountancy firms offer free one-on-one advice.

Becoming a Sole Trader is easy, but it might not be right for you.

[tinman0]

peter hh said:

Hi i am starting up a new Business as a Sole Trader and am wondering how to go about it.

It seems really easy to become a Sole Trader a little to easy, this is how i think you become a Sole Trader, plz tell me the right steps if i am wrong thanks!

1-Decide on what your Business will sell and what it will do.

2-Think of you'r Business name.

3-Register as self employed.

4-Open a Business Bank account

5-Register for VAT if income is over £60000

Is that it???

6-Make a sale


This last one is the difficuly bit

Good luck btw!