Introducing Business Law and Practice notes from The SQE Hub specifically tailored by addressing each of the assessment specifications listed on the SRA website. These high yield notes are an amazing revision aid and address the following:
- Business organisations, rules and procedures;
- Financ...
SQE 1 Assessment specification: Business organisations, rules and procedures
Business and Organisational characteristics (sole trader/partnership/LLP/Private and
unlisted public companies:
- Incorporated business = separate legal entities i.e. private limited company, public
limited company and limited liability partnership
- Unincorporated business = treated as being the same as the owner i.e. sole trader
or partnership
Sole Trader Partnership LLP (LLPA Company (CA
(Partnership 2000, LLPR 2006)
Act 1890) 2001, CA
2006)
Liability Unlimited Partners have Partners Limited
(personal unlimited liability limited to amount
liability of personal and not unpaid on their
individual) liability, joint personally liable shares (may
or joint and over and above require personal
several their capital guarantee)
share
Legal status of Individual No separate Separate legal Separate legal
business legal person personality
personality
Minimum 1 2 2 1
number of
persons
needed
Expenses Nil Partnership i. Admin costs in i. Admin/legal
before/duringN agreement is submitting costs in
il set-up advisable but LLIN01 submitting to
not necessary ii. Registration CH
fee ii. Creation/
iii. Creation of amendment of
members AOA and MOA
agreement iii. Registration
iv. Pricing LLP fee
stationery - iv. submitting
name must confir
appear on all statem/accounts
documents like
company
Publicity/discl Register with None - register Companies Companies
osure HMRC for self- for self- house: House:
assessment assessment registered registered
, Created by The SQE Hub 2023
(+VAT if individually office, office,
earning over (+VAT if members accounts,
85k) earning over details, members res,
85k) accounts etc cap statements
(+VAT if etc
earning over (+VAT if
85k) earning over
85k)
Ongoing Minimal Minimal Minimal accounts,
expenses auditing of
accounts, conf
state
Management NA No fixed No fixed Directors take
Structure structure but structure but day to day
should be set should be set decisions as
out in out in agents of
Agreement; in Membership company via
its absence Agreement. If board meetings
though ordinary not, LLPR shareholders =
matters decided provisions ultimate control
by majority; apply. as owners -
changes to consent
nature of required for
business fundamental
requires changes
unanimity
Financing Personal loans Limited to Broader range: variety of loans;
methods personal loans incl loans and floating
charges over charges, share
assets; no issuance
share issuance
Regulation Regulated by Partnership Act Limited Liability CA 2006.
contract law 1890 and the Partnership Act
legislation: partnership 2000 and the
Sales of Goods agreement. If no partnership
Act etc PA, then PA agreement. If no
1890 + contract PA, LLPA 2000
law legislation applies.
Tax Income tax + each Partner Individual Corporation tax
CGT (as a self- pays income tax partners are and VAT (if
employed on profits made. taxed on profits applicable) (plus
person) + VAT Must register at as income other industry
HMRC as self- tax/CGT (~LLP taxes)
employed. itself is not
Partnership firm taxed except
will pay VAT if VAT). Register
85k+ at HMRC as
self-employed.
Advantages very easy to very easy to Tax benefits Limited liability
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