If you decide to become self-employed, either on your own (as a sole trader), or with other people (as a partnership), you will be responsible for working out and paying your tax liabilities to HMRC.
sole trader tax
What are the differences between sole trader, partnership, Ltd and PLC in terms of taxation in the UK?
There are a number of ways in which you can set up and run your business in the UK. In this guide created by OrangeGenie, we look at the differences between sole trader, partnership, Ltd and PLC. We will focus on explaining what the type of company is, the tax implications, and the advantages and disadvantages of each.
Readers question: I want to open a cleaning company and hire a few people. I am finding it difficult to decide what is the best business structure for me, a limited company or a sole trader? Which would be the best, in terms of tax?
When opting for the self-employment route and starting up your own business, the chances are that the tax aspect won’t come naturally. You may be asking yourself some questions: how do I pay my tax without an employer taking it from my wage? Or is there any way I am able to make savings on my tax return?
The time of completing and filing a self-assessment tax return is a dreaded time for the self-employed. However, being prepared and having a good working knowledge of taxes and allowable expenses will surely make the task a little easier. Figuring out which expenses you can claim can be quite difficult when it comes completing the self-assessment tax return.