The job market in the UK is improving but more and more people are choosing to set up their own businesses, both creating jobs and helping with the recovery of the economy. Coming up with a feasible business idea and strategy is the hard part, and once you have decide what you want to achieve you can set about doing all the necessary paperwork and sorting out the logistics of setting up your company. There are a few important things to remember when setting up your business. Some of the main ones are listed below.
Business Bank Account
You should consider opening a business bank account from the very start. If you are setting up as a limited company or a partnership you are required by law to have a separate account for your business finances. If you are setting up as a sole trader or self-employed there is no legal requirement to have a separate business bank account, but it can be useful if you want to keep track of your incomings and outgoings quickly and easily, and for tax purposes.
The government is very keen to encourage start ups and new businesses and has made sure there is a provision in high street banks for those wanting to set up their own business. Most big name high street banks have specific accounts designed especially for start up businesses.
Business insurance
You should look to take out relevant insurances to your business from the offset. Seek advice to find out exactly what you need to be covered for. If you are going to be employing one or more members of staff you are legally required to have employers’ liability insurance. This covers you in case anyone working for you falls ill or is injured as a result of their job. The other big thing to remember when setting up your business is public liability insurance.
This is important for any businesses that are visited by customers, contractors or visit other companies. The insurance protects you should an accident occur that injures a third party or their property on your premises, or if you cause any damage whilst on theirs. You can find out more about liability insurance online or by speaking to a business insurance provider.
Setting Up Your Business Taxes
One of the most confusing aspects of starting a business is knowing what you need to do with regards to tax. There are different rules depending on what you are setting up as. Sole traders only need to worry about their own tax and national insurance, and in some cases VAT. If you have any employees however you need to make sure you are registered as an employer with HMRC as they need to be aware of any salaries or benefits you are taking from the company. A good first step is to call HMRC and explain what you are trying to do, they will then advise you of the necessary steps you must take to stay out of trouble with your taxes.
There’s a lot to consider when setting up in business. Take the time to thoroughly research the requirements for your business idea, to give it the best chance of success.
This article has been written on behalf of Hiscox, providers of insurance including those for the business sector. Should you wish to find out more about insurances for your start up or to discover how to get a liability insurance quote then visit Hiscox online.
Great tips. When I started blogging I didn’t do any of that because I didn’t expect to make and money or for it to become a business like it has. After a few months I soon realized I needed to get my stuff sorted and that despite not intending to have one, I had a business. It is much easier to get this sorted before starting out properly and much safer too.
3 things people often forget. I am amazed at the amount of people I talk to who do not have business insurance or if they do, it is inadequate. That combined with not sorting out their taxes or having a separate business account is a recipe for disaster.
Here in the States, it’s all about legal protections – protecting your personal assets from liability, taxes, etc. So for businesses on this side of the pond, doing your planning up front to ensure you have the proper protections in place, either business entity, or insurance, is an absolutely critical first step.