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1. Types of business in the UK
Most businesses are a limited company, partnership and sole traders. However,
social enterprises, charities and unincorporated associations still exist.1
Sole Traders
Sole Traders run their own business as a single person and they employ themselves,
You can keep all the profits your business makes, but you are personally responsible
for the money you lose as you are fully responsible for your accounting.2
Limited companies
‘If you form a limited company, its finances are separate from your personal
finances, but there are more reporting and management responsibilities. Some
people get help from a professional, for example an accountant, but you can set
up a company yourself.’ Limited companies such as Google, Facebook or Barclays.
There are three different types of limited companies.
Public Limited Company (PLC)- The ownership of this company is open to the public.
Anyone can buy shares and as it is limited, a individual’s financials liability is a fixed
sum which is mostly their investment.
1
https://l4creativeenterprise.blogspot.com/2019/10/set-up-business-govuk.html
2
https://theartsdevelopmentcompany.org.uk/resources/what-is-the-best-business-model-for-my-social-
enterprise/

2. Private company limited (ltd)- Private is opposite to Public as member of the public
cannot buy shares in the stocks. It is owned by a non-government organisation, or a
small group of shareholders.
Company limited by guarantee – These companies don’t have share-holders such
as smaller organisations like student unions, clubs, sports associations charities such
as Oxfam or PGA European Tour.
Partnerships
‘Partnerships are businesses owned by two or more people. A contract called a
deed of partnership is normally drawn up. They state the type of partnership it is, how
much capital each party has contributed, and how profits and losses will be shared.’
Social enterprises
Social enterprises usually have a social mission, typically they give back to the
community or the environment or creates positive social change.
Charities
Charities help to provide access and funding for those in need or organisations.
Unincorporated associations
‘An ‘unincorporated association’ is an organisation set up through an agreement
between a group of people who come together for a reason other than to make a
profit (for example, a voluntary group or a sports club).’