24062723
Description
Flashcards by christina Littlewood, updated more than 1 year ago
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Created by christina Littlewood
almost 4 years ago
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| Question | Answer |
| Sole Trader Who owns the business? | A sole trader is a self-employed person who owns and runs their own business as an individual. A sole trader business doesn't have any legal identity separate to its owner. |
| Sole Trader Number of owners? | A sole trader describes any business that is owned and controlled by one person - although they may employ workers. Individuals who provide a specialist service like plumbers, hairdressers or photographers are often sole traders. |
| Sole Trader Size of business? | Small According to the Government, in 2019, almost 60% of British businesses were sole traders, that's about 3.5m businesses out of a total of 5.8m. |
| Sole Trader Who controls the business? | Sole traders. A sole trader describes any business that is owned and controlled by one person - although they may employ workers. Individuals who provide a specialist service like plumbers, hairdressers or photographers are often sole traders. |
| Sole Trader Who finances the business? | As a sole trader, you're not legally required to have a business bank account. You can use your personal bank account for all business transactions. This is because as a sole trader, your personal and business income is treated as one and the same by HMRC for tax purposes. |
| Sole Trader Who has legal responsibility for the business? | Yourself keep records of your business’s sales and expenses and send a Self Assessment tax return every year. pay Income Tax on your profits and Class 2 and Class 4 National Insurance. |
| Sole Trader What type of liability is there? | Unlimited liability refers to the legal obligations of general partners and sole Traders, because they are liable for all business debts if the business can't pay its liabilities. |
| Sole Trader Who keeps the profit? | If you start working for yourself as a sole trader, you will own and run your business as an individual and will keep all the business's profits after taxes. |
| Sole Trader How is the business established? | Declare yourself as a sole trader to the Tax Office |
| Sole Trader How many employees? | Sole traders can still employ people But if you do employ people, you must collect income tax and National Insurance contributions (NICs) from them and pay these to HMRC. You'll need to operate a PAYE (Pay As You Earn) payroll scheme for this purpose. |
| Sole Trader Continuity – what happens if the owner dies? | You cannot leave your sole Trader business to a beneficiary, but you can leave your assets to a beneficiary in your will. Your beneficiary can use your assets to establish a new business. |
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