I’m setting up a small Pet Sitting Business:. my biggest concern is: at some stage someone’s pet will fall ill or possibly die in my care as a Sole Trader is there any way I can protect myself from being sued and losing all my personal assets? Do I have to set up as a limited company? I’m also currently a part-time employee permanent contract with another company; what impact will this have upon a start up?
As a sole trader your protection will come via an appropriate insurance policy. I would suggest looking at both professional indemnity and public liability which you will need if people are bringing their pets to your premises. You may need other insurances e.g. if you employ someone.
You are right in that a limited company would protect your personal assets by limiting liability to the company as a separate legal entity. However that does bring some additional administration with the legal obligations bestowed on a company (annual accounts, confirmation statement etc) and you may be worse off with the application of Dividend Tax to the amounts that you would extract from the company.
As regards doing this whilst you are working elsewhere, I would suggest that you check your contact of employment to see if it restricts you working elsewhere. When you complete your self assessment you will include all income on the return.
Advice given is for illustration purposes only and should not be relied upon for your tax planning or tax affairs. We recommend that you seek the advice of a suitably qualified accountant before making any tax planning decisions.