Sole Trader vs Ltd Company
The most important structural decision you'll make as a UK film freelancer. See exactly how much you keep under each setup — and by how much one beats the other.
Revenue minus allowable expenses — not your gross day rate.
Do you have a spouse or partner involved in the business?
This affects which structure is most efficient for you.
How It's Calculated
Beyond the Numbers
Sole Trader
Advantages
- Simple — register with HMRC, one Self Assessment per year
- Lower accountancy costs (~£300–500/year)
- Cleaner income proof for mortgage applications
- Best structure below ~£30–35k profit
Disadvantages
- Personally liable for all debts
- Higher tax above ~£35k profit
- Cannot retain profits in a low-tax wrapper
Limited Company
Advantages
- Significant tax savings above ~£35k profit
- Limited liability — personal assets protected
- Retain profits in company at corp tax rate (19–25%)
- Highly tax-efficient pension contributions
- Can add a second shareholder to split profits
Disadvantages
- More admin — Companies House, annual accounts
- Higher accountancy costs (~£1,000–2,000/year)
- Low salary complicates mortgage applications
- IR35 risk if working like an employee on set
Film Industry: IR35 Risk
If HMRC considers you to be operating like an employee of a production company, your income may fall inside IR35 — removing the Ltd company tax advantages entirely. This is a real risk for film crew on long productions. Always check your IR35 status before incorporating.
Based on 2024/25 UK tax rates. Guidance only — not financial advice. Always consult a qualified accountant.