Richard Curtis considers the pros and cons of business formats for start-ups.
Many people decide to start their own business. That decision – to go ahead with their project – is obviously important, but many will simply start without considering the business format. Commonly, this will come down to a choice between sole trader, partnership or company.
Overview
Subject to any regulatory requirements, a sole trader can simply start to trade under their own or a trading name. Costs will probably be low and they have complete control over the business with no requirement to disclose financial information. However, they are personally responsible for business debts.
At its most basic, a partnership is two or more individuals who are trading together – a formal partnership agreement is recommended to avoid future disputes as to profit-sharing,
