Operating as a sole trader simply means running your business in your own name. There is no extra structure that you need to set up, so it is easy to start with, but it is worth considering the pros and cons to being a sole trader:
- Low-level compliance;
- Taxable profit is taxable in your personal name;
- Losses can be offset against other personal income.
- Personally liable for all activity in the business;
- Bringing in new owners requires a change of structure;
- Subject to top personal tax-rate if the business profit is high;
- Public perception may be impacted in terms of size and strength of business.