Different Legal Forms of Business 2

Question 1

For sole traders, tell me about:

1) Cost
2) Risk
3) Structure
4) Formalities
5) Privacy
6) Finance
7) Tax

Answer 1

Cost - None
Risk - Unlimited personal liability
Structure - No formal structure
Formalities - No procedural requirements
Privacy - Complete privacy
Finance - Personal capital injection / personal loan
Tax - Self-employed tax return

Question 2

For partnership, tell me about:

1) Cost
2) Risk
3) Structure
4) Formalities
5) Privacy
6) Finance
7) Tax

Answer 2

Cost - None
Risk - Unlimited joint (contract) or joint and several (tort)
Structure - No formal, but can have PA
Formalities - No procedural requirements
Privacy - Complete privacy
Finance - Personal capital injection / personal loan
Tax - Partner taxed individually

Question 3

For LLP, tell me about:

1) Cost
2) Risk
3) Structure
4) Formalities
5) Privacy
6) Finance
7) Tax

Answer 3

Cost -
Risk -
Structure -
Formalities -
Privacy -
Finance -
Tax -

Question 4

For sole traders, tell me about:

1) Cost
2) Risk
3) Structure
4) Formalities
5) Privacy
6) Finance
7) Tax

Answer 4

Cost -
Risk -
Structure -
Formalities -
Privacy -
Finance -
Tax -

Question 4

For company, tell me about:

1) Cost
2) Risk
3) Structure
4) Formalities
5) Privacy
6) Finance
7) Tax

Answer 4

Cost - Incorporation costs
Risk - Liability of shareholders limited to amount unpaid
Structure - Separate legal entity
Formalities - Requirement to be registered at Companies House
Privacy - Various disclosures
Finance - Higher degree of recognition
Tax - Corporation tax