I'll help a little more with the first question:
There are major differences between trading as a sole trader and trading as a company.
The main thing to remember is that a company is a different legal person to you as an individual. So as a sole trader you = the business but a company and you are two completely different things.
The legal responsibilities are far more stringent and complex if you are a director and there is more administration to complete. Also don't be surprised if your accountancy bills go up - there is much more work to do.
The tax situation will differ and it can often (but not always) be more of an advantage in incorporating. Also you do get limited liability in the case of things going wrong - basically as a shareholder in a company you can lose your investment but as a sole trader you can lose your house.
I would say that if you are considering incorporating do read up so that you let yourself know what you are taking on; unfortunately many people don't. The BusinessLink website is a good place to start -
http://www.businesslink.gov.uk/bdotg/ac ... 1073865730 - this is a government website so there is no advertising involved; it just tells you what the differences are.
Good luck!
