You must choose a structure for your business. This structure will define your legal responsibilities, like:
- the paperwork you must fill in to get started
- the taxes you’ll have to manage and pay
- how you can personally take the profit your business makes
- your personal responsibilities if your business makes a loss
You can change your business structure after you’ve started up if you find a new structure suits you better.
The main types of business that you can choose from are:
- sole trader
- limited company
- business partnership
You can form an ‘unincorporated association’ if you’re setting up a small organisation like a sports club or a voluntary group and don’t plan to make a profit.
You can use other structures for businesses that help people or communities, eg ‘social enterprises’.