There are a number of advantages to Company registration the most obvious being “Limited Liability”. Unlike a partnership or Sole Trader, if a limited company should be unsuccessful the company would be wound up and only property/assets of the company can be claimed by creditors. Directors and shareholders have no personal liability whatever (unless they have acted improperly) and there are no restrictions on the directors pursuing further company formations.
A limited company enjoys more favourable tax concessions than either sole traders or partnerships. It is subject to tax but profits are not normally subject to higher rates of personal tax. Directors pay tax but they are entitled to claim all the normal personal allowances against income. This compares favourably with partnerships for example as their profits are divided for tax purposes amongst the partners and they are assessed personally on these amounts at once even if they have not actually drawn any cash out of the business.