Choice of business vehicle—tax comparison table
Choice of business vehicle—tax comparison table

The following Tax guidance note provides comprehensive and up to date legal information covering:

  • Choice of business vehicle—tax comparison table

FORTHCOMING CHANGE: the rate of corporation tax will fall to 17% for the financial year 2020.

This table compares the tax treatment of:

  1. sole traders

  2. partnerships (which in this table includes general partnerships, limited liability partnerships and limited partnerships), and

  3. companies

This table does not consider any reliefs or exemptions which may be available to particular taxpayers or any anti-avoidance provisions which might apply to particular circumstances.

The rates and thresholds included within the table are for the tax year 6 April 2019 to 5 April 2020 for individuals and for the financial year 2019 for companies.

For further details about the tax treatment of each type of business vehicle, see Practice Note: Forms of business vehicle—tax summary.

For further details on the choice between the types of business vehicle, see Practice Note: Tax influences on choice of business vehicle.

  Sole Trader Partnership Company
Tax Treatment No separate taxable entity - sole trader taxed as individual with trading activity No separate taxable entity - partner taxed as individual on a notional trade representing his share of the partnership