Category Archives: Sole Trader or Limited Company

Sole Trader or Limited Company

Do you prefer profit or dividends?

The difference between these two types of income lies at the heart of the distinction between a Sole Trader and a Limited Company.

Here is an illustration:

If you made £50,000* profit, would you prefer to declare all of it as income and pay £13,310 to HMRC, or pay yourself a very small salary, take out the remainder as dividends and save £2,321?

OK, so saving £2,321 is great but what if it came at the price of quite a bit more bureaucracy and READ MORE