Jorge is planning to set-up a restaurant business called Herring, serving Scandinavianstyle fast food. He has plans to start by opening one restaurant and then within months to open at least two more. He has a great deal of experience in the catering sector but has never previously set-up his own business. He is confident of raising the necessary funds as he has substantial savings, the bank has indicated it would be prepared to make a loan, and his friend Ulrika has made it known that she would be keen to put money into the venture. He is considering whether to establish the business, Herring, as a limited company or as a sole trader.

REQUIRED:

List the advantages and disadvantages to Jorge of setting up the business as: 

a) a sole trader; 

b) a limited company.