How to start your own business: Set up your business
Set up your business
You’ll need to decide which legal structure is right for your business before you
register and start trading.
It’s important to understand the different risks and benefits
before you choose - whether you set up as a sole trader, limited company or
partnership affects:
·
the amount of financial risk you’re taking on
·
the way you’ll need to pay tax, and report to HM Revenue &
Customs (HMRC) and Companies House (for limited companies and some types of
partnership)
·
how much control you have over how your business is run
Employing people
If you’ll need extra help or people with specific skills to run
your business, you might decide to take on employees. Find out about your legal
responsibilities as an employer, including things like pay, tax and insurance,
before you start employing staff.
You’ll need to register as an employer with HMRC if you want to employ people, even if
you’re a sole trader.
Other responsibilities
Even if you’re not employing people, you’ll need to get insurance
for your business.
Depending on the type of activities your business is involved
in, you might need to get certain licences and permits.
Working with advisers
Make sure you get an estimate from any advisers you work with, and
agree in advance what they will do.
Some advisers will charge an hourly fee, and others may offer a
fixed price for a piece of work. It’s always worth getting several quotes
before you decide who to use, so you can compare prices and make sure you’ll be
able to work well together.
Accountants
An accountant can help with things like financial advice and
managing growth. You can also appoint them as an ‘agent’ to deal with your tax
affairs, submit your VAT returns and deal with HM Revenue & Customs (HMRC)
on your behalf.
‘Chartered’ accountants are fully-qualified members of a
professional body. There are several UK professional accountancy bodies and you
can find chartered accountants through them:
Legal advisers
You should also consider getting legal advice when setting up
your business. This is particularly important if you want to sell
shares.
Find a
solicitor on the
Law Society website.
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