Ltd company or sole trader

[domainguy]

I have a full time job and pay top rate tax. I also as a hobby have started selling art that I create. Until now I haven’t been making any money but now am. Should I setup a limited company? I have no other income so no accountant. my wife doesn’t work. I’m not very clued up on the pro’s and con’s I’m afraid.

 

[fisicx]

Sole trader. Keep it really simple.

Better still, get your wife to sell the artwork, it’s likely she won’t have to pay any tax.

 

[domainguy]

But sole trader I’m paying 50% tax. Would I still be paying that via company Or more?
yes I meant to say it’s my wife’s art ?

 

[fisicx]

Make your wife the sole trader. Make it her business - your name won’t appear anywhere. She can then earn £12,579 per year without paying a penny in tax. Doesn’t affect your earnings.

 

[MyAccountantOnline]

I have a full time job and pay top rate tax. I also as a hobby have started selling art that I create. Until now I haven’t been making any money but now am. Should I setup a limited company? I have no other income so no accountant. my wife doesn’t work. I’m not very clued up on the pro’s and con’s I’m afraid.

I'd certainly consider the limited company option as you are a higher rate tax payer.

If your wife works in the business she could be paid a salary via the company to use her tax free allowance (assuming she has no private income).

 

[Quality Formations]

I have a full time job and pay top rate tax. I also as a hobby have started selling art that I create. Until now I haven’t been making any money but now am. Should I setup a limited company? I have no other income so no accountant. my wife doesn’t work. I’m not very clued up on the pro’s and con’s I’m afraid.

We've written a blog post on this very subject!

Sole trader or limited company – which is better for me?

Discover the pros and cons of sole trader vs limited company structures for tax savings, liability protection, and growing your business.

www.qualitycompanyformations.co.uk

We hope that helps.