Key advantages and disadvantages of various business mediums

Question 1

What type of liability do sole traders and general partners have?

Answer 1

Unlimited personal liability

Question 2

What type of liability do shareholders of a company and members of LLPs have?

Answer 2

limited liability

Question 3

How can companies and LLPs be formed?

Answer 3

Only by filing the relevant documents at Companies House

Question 4

Do sole traders and partnerships need to file anything to be formed?

Answer 4

No

Question 5

How are the four main business entities taxed?:
1. Sole traders
2. Partnerships
3. LLPs
4. Companies

Answer 5

1. ST - income tax
2. P’ship - income tax
3. LLP - income tax
4. Companies - corporation tax and dividend income