Katharine is a professional dancer, but due to an injury she will no longer be able to continue dancing at the same level. She is seeking legal advice on the possible business structures she can choose between if she decides to open a dance studio.

1. Advise Katharine on the legal requirements in the UK to set up as a sole trader as opposed to starting a general partnership with some other dancers.

2. You feel that Katharine should also know the pros and cons of a limited liability company.

a. Should Katharine decide to set up a limited company she needs to know the difference between ordinary, preference and redeemable

shares. Explain what these are to her. Which do you consider would be most appropriate in her case?