Legal Structure

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.

Types of business

The main types 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’.

Date last updated: 07/08/2015