Should I set up a Company?

Company or Not?

There is no right or wrong answer about whether or not to trade as a company, but it really comes down to what your intentions are in the future. To answer the question, I need to ask one, “What will you be doing in the next 2 to 5 years?”

Some common answers I have are:
a) This is a one-year contract, then I’m not sure what I’ll do.
b) Once this contract finishes, I’ll get another contract.
c) I’m going to build this into a business, and look at employing people and leasing an office.

I call the category A people as the “undecideds”. There is nothing wrong with being in this category but if you are I’d probably suggest that you operate as a sole trader rather than a company. Having a company is not going to

Category B people are “career contractors”.

The Category C people are launching a full on business and it would be a good idea for them to use a company structure.

The other consideration is how much risk will you face, and is a company going to help minimise this risk.