Company versus Sole Trader
As a sole trader you are personally liable for all business dept - which means you could lose everything you own. As a shareholder your liability is limited to the value of shares you hold. If you hold 99 shares at NZ$1.00 each, your liability for the company dept is limited to $99. Your liability can increase if you are a guarantor for any of the company dept, or you are shown to be negligent or traded recklessly.

Registration of Your Company Name
Once your company has been incorporated, no other limited company can have an identical or near identical name. 

LAQC (Loss Attributing Qualifying Company)
You can register your company for LAQC status with the IRD and if it makes a loss over the tax year, the loss can be distributed to the shareholders for that year.
Example: Company XYZ Ltd makes a $50,000 loss for year 1-Apr-04 to 31-Mar-05
Jack owns 90% of the shares & earned $110,000 PAYE for year 04/05.
Jill owns 10% of the shares & earned $10,000 PAYE for year 04/05.
Jack gets 90% of the $50,000 loss = $45,000 distributed to his personal income.
Jill gets 10% of the $50,000 loss = $5,000 distributed to her personal income.
The tax rate (Apr-04 to Mar-05) is:
19.5% for 0 - $38,000
33% for $38,000 - $60,000
39% for $60,000 and above
Therefore:
Jack should have only paid tax on $65,000 ($110,000 - $45,000) and gets a refund from the IRD of
$45,000 x 39% = $17,550.
Jill should have only paid tax on $5,000 ($10,000 - $5,000) and gets a refund from the IRD of
$5,000 x 19.5% = $975.

Employing Family Members
To employ family members as a sole trader you need to get special permission from the IRD, whereas a limited company can employ family members without the requirement to get IRD permission. Companies employing family members can have advantages by spreading the workload over the family members, therefore spreading the salaries over the family members, ensuring more of the PAYE tax is at the 19.5% rate (therefore less at the 39% rate).