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Setting up as sole trader and registering company name - CONFUSED!(14 Posts)
Hi. I recently decided on my company name and I now have a domain registered and my website is under construction. I also registered as a sole trader with HMRC and I am waiting to hear back from them. My question is, do I have to register my company name separately with Companies House? Do I need a registered company number? And who does this come from? The HMRC website is as clear as mud, but I have managed to register - it's just the next bit I'm not too sure about!
Are you a limited company or a sole trader? The two are quite different and distinct. You only need to register with companies house if you are a limited company. OH has run a business as a sole trader for 8 years, we are now transitioning to Ltd company status, and so now we (the Ltd company) are registered with companies house, but never were before.
Are you trading as a sole trader, or have you set up a company? If you are a sole trader then you won't register with companies house as you don't have a company.
Hi, just registered as a sole trader but I do have a company name for my website etc. Do I need to protect or register the company name in any way? I doubt anyone is going to try and nick it, but I quite like it!!
You don't have a company name, you have a business name. Two very different things.
You're not a company, you're a business. So you won't have a company number.
Companies house is for limited companies so doesn't apply to you.
You can register with HMRC for VAT, in which case you'll get a VAT number.
You can trademark your business name if you want - but that's a bit extreme (unless your business name is awesome and will make you millions!).
Thanks! I think I've got my head round it now. I don't suppose there's much danger of anyone trying to nick my business name. I read somewhere that I should register the name as a dormant company to protect the money, but that was a site that offers to do it all for you, so I guess they're just on the make. I guess I'll just stop worrying about it lol.
No, don't stop worrying about it. Do your research to get the ins and outs of what you are doing.
Our accountant set up all our Ltd company, it took all the hassle away.
Yes, our bill was higher that year but it was tax deductible so saved us hassle and cost nothing.
Why not ask about the differences, sometimes its better to be a Ltd company even if you are only really a sole trader/ working for yourself.
I know it has saved us a lot just in tax and what we can claim back.
Don't stop worrying, it is your responsibility to know about these things you are liable if you get it wrong and it can be heavy duty.
Do your homework and realise you can't just register with little knowledge, this is why companies exist to help with it all.
I would advise you to read up about the key differences between sole trader and limited companies. It's easier to start with the right setup for you rather than realising one doesn't quite fit afterwards.
There are pros and cons for both and each fit different types of businesses, income and tax and also whether you want investment through share holders etc.
OP I read somewhere that I should register the name as a dormant company to protect the money - I have no idea what that means. You can't register your BUSINESS as a company, dormant or otherwise, because you're a BUSINESS not a company! Honestly, there are very different things.
Also, I have no idea how registering a dormant company 'protects' money. That sounds potentially like some very dodgy website. But I'm absolutely no expert.
I agree with Siarie it sounds like you need to do a bit more research in to how you want your business to run.
Most accountants will come and see you for a free intro meeting and give you some helpful insights.
If you want the easy life, sole trader is probably best. The money you earn is yours, do you your annual self assessment and you pay income tax on it. And it's easy to manage without a book keeper or accountant. End of.
A ltd company will save you money on tax. However you have a lot more paper work to do (or your accountant does), companies house to deal with, PAYE, NIC, corporation tax, director's dividends and your own self assessments. It's not the easy option.
It really is down to how much you're planning on earning, how much tax you want to save yourself and how difficult or easy you want running your business to be.
I am sitting here doing a legal letter to someone who has taken someone's trading name. Luckily my client has registered a trade mark. Do think about it. If you register (costs about £200) at www.ipo.gov.uk a "registered trade mark" (obviously check first your name is not the same as anyone else's or similar in the same field first before every choosing any business name) you get much stronger protection than if you just build up a reputation in the name.
On business names - the advice is right above. You are not a company and must not call yourself one. You have a business. You are a sole trader. You have not registered a limited company so companies house is not relevant to you.
Hi everyone. Thanks for all your feedback and advice. Apologies, my second post was a bit misleading. It should have read that I was advised to protect the business name, not business money! I think that query has been answered by Greengrow's response.
Sole trader definitely seems to be the way to go, I was just trying to clarify the confusion over the other advice I had been given and your responses have helped to clarify that. Thanks again :-).