In the first half of 2022, over 90 new businesses were created every hour by UK entrepreneurs, so while the economy might be struggling right now, there are a plethora of new and innovative companies emerging.
In turn, helping boost sectors and bring vital services and products to consumers and other companies alike.
If you have been on the fence about joining the masses, registering your own business and becoming your own boss, this post can be your checklist for ensuring you start off on the right foot and give yourself the best chance to succeed.
A Solid Business Plan
When setting up a business in the UK, having a solid business plan is a crucial first step.
This plan should include objectives, strategies, sales, marketing, financial forecasts and a clear understanding of your target audience.
It’s not just about the final document; creating this plan can help you understand the scope of your business and open your eyes to the realities of entrepreneurship.
A comprehensive business plan will help you secure funding and attract potential investors.
Don’t forget a good business plan is constantly evolving and should be updated as your business grows and changes.
Define Your Legal Structure
When setting up a UK business, the legal structure is one of the most important things to consider.
Entrepreneurs should think carefully about how they intend to do business and choose a structure that best suits their needs.
The proper legal structure will define their legal responsibilities, financial liability, and tax obligations.
Each legal structure has advantages and disadvantages, whether a sole trader, limited company or partnership.
- A limited company removes some of the financial responsibility. It allows business owners to not be liable for debts in the event of a company folding.
- A sole trader will incur all of the business’s debts should things not go to plan, and the individual and businesses will be seen as one entity.
- A partnership will enable you to raise more capital for your business. The business will be a legal entity in its own right.
Register Your Business Name
Once you have decided on your legal structure and have a solid business plan, it’s time to register your business name.
It is essential to check if your chosen name is unique and not already in use by another company.
Use the Companies House name availability checker to ensure your name is available.
If you are a sole trader, you don’t need to register a company name, but it’s crucial to ensure you register with HMRC.
You must also obtain a Company Registration Number (CRN) if you register as a limited company or limited liability partnership with Companies House.
Don’t forget to check your business name on social media to ensure you haven’t missed anything and that the social media handles you want to use are available.
Lastly, check that the domain name is free, too, so you can set up your web presence and get ready to go.
Create A Marketing Plan
Once you have a solid business plan and legally register your business, creating a marketing plan is time.
A marketing plan is a crucial component to the success of any business, as it outlines the strategies and tactics you will use to reach and engage with your target audience.
It’s essential to thoroughly research your market and understand your strengths, weaknesses, and opportunities before deciding which customers to target and how to win them over.
A fully digital approach can be the best and cheapest marketing option for many newer businesses.
However, other companies, such as retail, will benefit from both digital and traditional marketing methods.
Get Relevant Insurances
Proper insurance coverage protects against financial losses from potential risks and liabilities.
It is essential to identify the kind of policies that are relevant to the business and not waste money on unnecessary insurance.
Employers’ liability insurance and professional indemnity insurance are mandatory for many companies in the UK.
This depends on the type of business and services it provides.
Other types of insurance include employee liability insurance, building and contents insurance and vehicle insurance.
You can get online van insurance quotes to ensure you are covered when driving for your company.
Obtain Permits and Certifications
Do you need to obtain certificates, permits or licences to operate?
For example, those selling alcohol need to get a licence to sell alcohol either on or off the premises and ensure you train all employees and are up to date with new rules and laws regarding the sale of age-restricted products.
The same applies to food and beverage businesses.
You need to obtain permits and undergo environmental health inspections to ensure you safely prepare, store and cook food and drinks to ensure no one becomes sick from your products.
Ensure you know what you need to trade legally and have this in place before opening the doors.
Know Your Tax Obligations
As a business owner, you are responsible for paying your own taxes, and it’s essential to stay on top of this to avoid any penalties or fines from HMRC.
Keeping accurate records of your sales and expenses will help you file your Self Assessment tax return each year.
It’s also worth familiarising yourself with the various tax allowances and deductions available to you and setting aside a portion of your profits to cover any tax liabilities.
You may also need to set up PAYEE accounts for employees to ensure they are paying the right levels of tax and National Insurance and that the appropriate deductions are made from their wages.
Have An Effective Filing System In Place
In addition to all the other essential steps involved in setting up a business, ensuring an effective filing system can make all the difference.
Keeping track of all your important documents and contracts in an organised manner will save you time and headaches in the long run.
By having everything adequately filed away and easily accessible, you can quickly locate and retrieve important information when needed. This will also help you stay on top of deadlines relating to taxes, permits, and renewals of licences.
Starting a new business can be complicated, and knowing what to focus on can ensure you don’t skip anything and have the right to trade legally in the UK.
If you are ever in doubt, contact HMRC or your local council and discuss your options to avoid falling foul of the law.