I think Brenden is saying that the main benefit of limited company is that you have limited liabilty within the confines of the company's assets and balance sheet and if things go bad etc your house and home etc are 'safe' As a Sole Trader and an individual you are personally liable to all debts etc. So if you get sued or anything like that your car, your house, your personal savings etc can be leveraged. Within a Limited company, unless a Director has put up personal guarantees or has malpracticed then the debt is not persued on a personal level.