paye and limited company

Hi all
Hopefully I have posted this correctly. I am a paye worker as was my husband for the last 20 years. He started a small shop with his brother last year. The shop is trading everything up to date but not making any money other than paying the 2 staff who work there. Since then my husband has lost his job and is now on jobseekers benefit. My query is this if he were to go onto the business how should it be done? Should they wind up the company and then he become a sole trader? Having researched on aam it would appear thats how things always should have been set up but the accountant they are using discouraged it in the beginning. He hates being at home although we have 3 children he just wants to work. However it does not seem like he is going to get anything in the near future. I think he is getting a bit depressed not working and would really appreciate any advice on what we ought do.

Not really sure what you are asking here there than some general advice. It's not specifically about PAYE and Ltd company as your title suggests. For what it's worth here are some pointers as I see them from reading your post.
1. No one likes being unemployed so I understand how your husband is feeling.
2. If the current shop business is working, although it may not be making profit, if it is covering all the costs then it is a working business. Many lifestyle businesses are run for the benefit of the people working in them (usually family). So if a wage is being made it is sometimes more important than profit and dividends. Now whether there is a job in it for your husband only he and his brother can tell. It will mean someone already working there will have to go because it is only covering costs at the moment. Alternatively there may be growth in the business maybe your shop specializes and can sell online or door to door, there are often other options if you are doing something different.
3. If your husband and his brother are employed in the shop then it is proper to do it PAYE employee basis. There may be some advantages to sole trading or partnerships but if all goes badly then limited liability protection may be valuable. Only you can tell on the long term viability of the shop and the products you sell.

Hi Thanks for your reply

I suppose the question is if a company is very small would it not be better to be a sole trader and then if so is it an easy process to change from a limited company to that of a sole trader. I agree with you on its being about more that just money though. Currently neither of them are working in the shop. Will all of this have any impact on me other than I suppose not getting some of his tax credits? I am the asessable spouse and I got a 11e form which scared the life out of me. I dont really like that aspect of things but I suppose that comes with being in business just something I am not familiar with.