Next Gen 28/05/16 Legal Entities in Games, Animation and VFX

Sole Trader
You run your own business as an individual. You can keep all your business's profits after you've paid tax on them.
You can employ staff. Sole trader means you're responsible for the business, not that you have to work alone.
For tax they must: send a self assessment tax return every year, pay income tax on the profits you make and pay national insurance (also register VAT if you expect £83,000 a year).
If this is your wanted idea, you must: keep records of the expenses and profits, your own business debts, bills for anything you buy, and paying the full income tax

Limited partnership and liability partner
Your liability or business debt differs depending on whether you're a limited partnership or liability partnership. You share all of the profits between partners. Each partner pays tax on the share of profits.

Limited Partnership: The liability for debts that cant be paid in a limited partnership is split between partners.
General partners can be personally liable for all partnership debts, limited partners are only liable up to the amount they initially invest in the business

Limited Liability Partner: These partners are not personally liable for debts the business that they cannot pay., they are limited by the amount of money they invest in the business. The responsibilities and profits are set out in a agreement. Some have extra responsibilities if it is required by the agreements. As well as having two members to get the company started, you will need a registered address and made a LLP agreement of how the business is run.

Every year, the partnership must send a partnership self assessment tax return to HMRC.
for tax they must: send a self assessment tax return every year, pay income tax on their share of the partnership's profits and pay national insurance(also register VAT if you expect £83,000 a year).

Unincorporated association

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.

You don’t need to register an unincorporated association, and it doesn't cost anything to set one up.

Individual members are personally responsible for any debts and contractual obligations.

If the association does start trading and makes a profit, you’ll need to pay Corporation Tax and file a Company Tax Return in the same way as a limited company.

Ordinary business partnership

In this you share the responsibility with your business partners. You share all profits and pay tax on all profits.
You are responsible for the losses your business makes and bill for things that your business, like stick or equipment
A partner does not have to be a person. A limited company can count and can be a partner in a partnership. You must also choose a name for your partnership and register it with the HMRC.

The nominated partner must send a partnership Self Assessment tax return every year.
All partners must: send a Self Assessment tax return every year, pay income tax on the share of the profits and pay national insurance. A VAT will be required if you except more than £83,000.

Limited Liability Company

Incorporating means registering a limited company or LLP at Companies House: it’s a move that will lend credibility to the business. It may also make it easier to borrow money when the time comes. But do look carefully at your motives: being the managing director of a limited company may bring status, but you may regret the move when struggling with the year-end accounts.

Most private limited companies are owned by their shareholders and are limited by shares. This means that the face value of their share in the business is the most they can be called on to pay if things go wrong.

The tax regime is more favourable to a registered company than to a sole trader. Limited companies pay corporation tax on their profits and their company directors are taxed as employees in the same way as other people who work for the company. The UK small profits corporation tax rate, applied up to £300,000, is 20% for the corporation tax year beginning 1 April 2014 and 21% above this (different rates apply to different financial years). But in a limited company profit there is also a firewall between profit and your income: you will have to pay income tax on the salary the business pays you.

Once you are trading, you will be required to submit full statutory accounts and a company tax return to HMRC each year, as well as making monthly or quarterly payments of employees’ income tax (PAYE) and NICs.

Public Limited Company

A PLC is a standard legal designation of a company which has offers of shares to the general public with limited liability. The stock can be acquired by anyone and the holders are only limited to the lose the amount paid for the shares. It is more commonly used in the UK. However, two or more people are required to form such a company. These companies can also appear on Stock Exchange boards and will have PLC on their ticker symbol.

Ways that Businesses are Funded

Tax Reliefs
This means that either the business pays less tax to take into account the money that you spend, such as business expenses (if your self employed), or get tax back or repaid like in a pension. All forms of tax relief are only apply if they are applied for. 
Sales
This is when consumers buy the finished product, all of money that does not go to other parties and services is profit for the business.
Crowd Funding
This is when you create a project that is funded by a community of people giving donations adding  up to a set goal. Websites such as Kickstarter and Indie Go Go were made to create crowd funding. 
Creative England
This is a business that was created to get small projects from indie developers going. They do both independent films and game productions.  However, they do have some limitations and rules (having the production below £500,000 and having deadlines on the production) and they can only handle a new project a few times a year to get everything ready. 
Grants
A grant is a set amount of money that is given by government, unlike loans you are not required to repay it over the years. The only catch is that you are required to give updates on your project somewhat regularly.
Early Access
This is a recent system that has been created to help more indie game designers. This is when a designer has uploaded a pre alpha version of the game, in this version it allows a bunch of people to test the game and give feedback to the developer; this service however does cost the tester. The extra money the developer makes can allow the game to be finished. 
Loans and Credit Cards
This is when you take a deposit of money from the government within a certain limit. Over time they are paid back with the profits of the organization. 
Business Angels
These are individuals who invest in certain businesses and projects so that they get a profitable return on their investment. The term can last for the entire time the business exists.  The result of this has been around 27% in the US and 22% in the UK. Their investments can be anywhere between £5,000 and £250,000. 
Advertising and Sponsoring
Sponsorship is when you ask to be associated with a certain company. This in turn you you pay this party for a service and you get a return in the form of advertisements, getting your name out into the eyes of the public increases the chance of sales (Example, if a company funds your project, you will be obligated to have advertisements for what the business wants).
FIG
This is a service to get both indie developers in the industry tending and larger companies to get leftover projects going. FIG has been able to fund projects such as Outer Wilds and Psychonauts 2. FIG provides a variation of advertisements, crowd funding and processes to get the project going and to gain attention.