Sole trader Builder or Limited Company Builder

[eggerb]

I've met with a few builders recently for a small extension I am planning. In the present climate, would you be more inclined to go with a sole trader (just trading under a registered business name) as opposed to a limited company.

 

[sparkeee]

go with someone who you can research their history and verify their work independently.

 

[Clarelassie]

Also on our builders home bond insurance there is insurance against the builder going out of business during your build - might be something worth checking out.

Good luck with your decision.

 

[Sconhome]

Be aware that Home bond doesnt cover extensions.

You want a builder who knows what they are doing, who is properly insured and has a checkable history and references.

Yes you may feel that you have more options with a soletrader if he goes out of business, directly responsible etc, if he has no money or assets it will mean absolutely nothing. You also can not check the financial status of a soletrader.

A company can not just go out of business, yes they may shut their doors and be just as uncontactable as the sole trader but there is a lot of legal compliance, cost and paperwork involved in liquidating a company. You can check a companies history and financial status, yes they may be a year old in the CRO, but it is a check point.

 

[eggerb]

Thanks all.

....
Yes you may feel that you have more options with a soletrader if he goes out of business, directly responsible etc, if he has no money or assets it will mean absolutely nothing. You also can not check the financial status of a soletrader...

That's basically where I am coming from. After checking out their references, previous work etc and all things being equal, I reckoned that I may have more come back against a sole trader but that may be fine in theory as you've pointed out Sconhome.

 

[Peter C]

It really doesn't matter if you have a decent builder who prices the job properly, too cheap should ring alarm bells and there is a lot of undercutting at the moment almost as much as unfinished jobs. I believe a land line as the main contact is a good indicator of long standing, if I was spending a lot of money I would go for a business established more than ten years, so many of the "Tiger Companies" are going through major adjustment customers actually want value for money now. Do they have their own equipment or is everything you see from a hire shop ? Do they sub contract everything or have their own trades / staff employed ? The present company laws may cause some Ltd companies to cease trading where sole traders can actually trade through tough times without any of the legal penalties imposed on Directors of Ltd companies.