Starting your own business can be very rewarding. But before you pursue this step, you may want to look at the key areas of the company establishment process, to ensure you create a business which can thrive. Turner little asks: what are the basic considerations of starting a business?
Business model
Before anything else, ask yourself; what kind of business you are going to set up? There are different advantages and disadvantages to sole tradership and forming a limited company, so research both these models before making a decision. It is easier to establish yourself as a sole trader and all your business’ profits, sans tax, will remain yours. However, you will also hold also legal and financial responsibility for your business with this option, so it may not be appropriate for your circumstances.
It isn’t particularly costly or time consuming to form a limited company albeit there a number of legal and administrative responsibilities that go with limited company directorship. However, with this model your personal assets will be protected, as you hold less personal financial and legal responsibility. With this option you pay yourself as an employee of the firm and can do so via company dividends, which can prove advantageous for tax purposes. Turner Little can advise you on forming a limited company.
Rules and regulations
Research all the regulations, taxes and licenses attached to the type of business you plan to create. If you fall foul of regulation or fail to pay the necessary taxes to HM Revenue and Customs (HMRC), then you may be required to pay a significant financial penalty. Turner Little can recommend an accountant or lawyer should one be necessary, and they possess the knowledge needed to advise you on these matters. They will also be able to ensure that you opt for the business creation model which is appropriate for your company under UK law.
Company name
It is vital that you choose an appropriate name for your company. This will form the foundation of your business’ branding, so make sure you conduct market research so you pick something which resonates with your target consumers. You will need a name to register your business with Companies House. Also make sure that there is a web domain available for your desired name, so that your business can market itself and sell goods and services to increasingly digitally-savvy consumers online. Turner Little can help you do all of these things so your business can trade effectively online or offline.
Appropriate insurance
Start-up portal Small Business writes that “another pivotal factor to bear in mind is your insurance requirements.” Insurance is a key red tape issue for small businesses, as failing to get the correct insurance for your company’s circumstances can open you up to legal action and governmental fines. You will need public liability insurance; this protects you if suppliers, clients or consumers suffer personal injury or property damage because of your company. If you hire employees you will also need employer’s liability insurance for similar purposes.
Launch funding
You will need to acquire funding in order to bankroll the launch of your business. It is key that you write a business plan; this will serve as a valuable blueprint of your company’s prospects for investors. Consider alternative sources of funding such as equity finance, where you exchange shares in your business for capital, to ensure that you can utilise the right vehicle for your circumstances. It vital that you have the financial tools necessary to handle start-up funds. We can advise you on opening a UK bank account, so your business has the financial infrastructure it needs in place to thrive.
Turner Little
Turner Little was founded in 1998 and it has since become a well-established UK based professional Company Registration Agent, Registered Bank Intermediaries and Business Consultants, as well as Trust provider. You can receive our monthly newsletter by signing up using the form below.
