Sole trader or limited company?
What incorporating actually changes — liability, cost, and how much of your life becomes public. Includes the identity verification requirement that now applies to every existing director.
Most of the businesses in this directory are sole traders, and for most of them that is the right answer. Incorporating is sometimes worth it and is often done too early, on the strength of a feeling that a limited company is more professional.
The real difference
| Aspect | Sole trader | Limited company |
|---|---|---|
| Legal status | You and the business are the same person | The company is a separate legal person |
| Liability | Your personal assets are exposed to business debts | Generally limited to what you put in |
| Setting up | Tell HMRC — no fee | £100 to incorporate online |
| Ongoing admin | Self Assessment | Annual accounts, confirmation statement (£50), Self Assessment |
| Privacy | Your details are not on a public register | Your name, part birth date and an address are public |
The liability line is the one that should drive the decision. If you sign a studio lease, take on staff, carry stock on credit or do work where a mistake could be expensive, separation is worth real money. If you sell your own work at markets, it may not be.
Everything becomes public
This is the part people find out afterwards. A company's directors, their month and year of birth, the registered office and the people with significant control all go on a free public register, along with your accounts. That is precisely how much of this directory was built.
- You can use a service address for correspondence so your home address is not the one on display — do this at incorporation, because removing it later is harder than never publishing it.
- The registered office must be an address where post can actually be delivered and acknowledged. PO boxes are no longer acceptable.
- Accounts get filed and published. Small companies file heavily abridged versions, but the balance sheet is public.
Identity verification — check this now
Since 18 November 2025, verifying your identity with Companies House has been a legal requirement for anyone setting up, running, owning or controlling a UK company. For new incorporations and appointments it is part of the process. Existing directors confirm it with their next confirmation statement, during a transition period that runs to November 2026.
Filing on time
Late accounts bring automatic penalties that escalate the longer they are outstanding, and they are not usually waived. A late filing history is visible to anyone who looks, including the people deciding whether to give you credit or a grant. This directory records filing status for the companies it lists, because punctual filing is a reasonable proxy for a business that has its affairs in order.
You can change your mind
Starting as a sole trader and incorporating later is normal and straightforward. Starting as a company because it sounds better and then discovering the admin is not. If you are unsure, the free advisers at the Business & IP Centre will talk it through with you without selling you anything.
Sources
Everything above was checked against these on 12 August 2026. Fees and thresholds change — if you are about to act on a number, follow the link and confirm it.