A sole trader runs their own business as an individual (as opposed to a company) and is self-employed. They keep all of the profits their business makes and are also personally responsible for all losses and debts.
You will need to set up as a sole trader if you earned more than £1,000 from self-employment over the last year; if you want to make voluntary National insurance payments, or; if you need to prove your self-employed status. To set up as a sole trader you need to register for Self Assessment.
When determining what to call your business, you can trade under your own name or create a business name. Your business name must not include ‘limited’, ‘ltd’ ‘limited liability partnership’, ‘llp’, ‘public limited company’ or plc as these are for registered names for companies.
Whilst you have a huge degree of flexibility in choosing your name, it cannot contain any sensitive words or suggest a link to government bodies or authorities. In choosing your name you must also ensure you do not infringe any intellectual property rights, such as trademarks.
You do not need to register your business name as a sole trader. You may however want to register your name as a trade mark if you want to provide other people using your business name.