Setting up as a sole trader is by far the simplest way of becoming self employed. There is nothing to register – except yourself with the HMRC for self-assessment and national insurance contributions – and no fees to pay. You can work the hours you want, when you want with no one to answer to and basically if you have become self employed as a way to bring some flexible working practices into your life with a bit of extra money, you couldn’t ask for anything simpler.
There are just a few points to consider and you don’t have to do it all at once. There are very few regulations and most of what you have to do is simply commonsense. Some areas of business have their own regulatory bodies and of course you have to adhere to any rules they lay down. These include things like child minding and anything to do with the food and drink industries and the setting up of these can be quite complex, but as far as the sole trader aspect of this kind of business is concerned, it is still relatively simple.
You can use any name you like, but you shouldn’t really use something that implies you have a link with a larger concern. Your name might actually be Anne Summers, but if you intend to sell lingerie it might be better to trade as something else! If you do use another name, your own should be on any headed notepaper or cards, to prevent an accusation of misrepresentation and of course you do want to avoid any name that could be misconstrued, but there are not the limitations for a sole trader that would apply to a limited company.
If you use your home to work from there should be no problem with business rates or anything like that as long as the room you work from is used for other normal domestic purposes. Unless what you do can be a nuisance to others – and here we are talking about child minding again, or a cattery, carpentry or other noisy jobs or car dealing or anything like that – there should be no need for planning permissions either. Good old commonsense comes into this aspect as well – if you wouldn’t want yourself as a neighbour, you should probably think again about running your business from home!
There is a downside of course to the apparent simplicity of setting up as a sole trader and that is perhaps an obvious one. Just as you are the only one to decide what to call your business, where and when and how to run it and what it actually does, so are you liable for all its debts and losses. For some businesses with a very low start up and not very much stock or equipment, this could be an unimportant issue. But for others with a large initial set up cost and a slow crawl towards profitability, this could be a very serious consideration and one which should be given a great deal of thought.