Thinking of setting up a business? Then you’re in the right place. This guide contains all the tasks you need to complete to successfully start your business and more.
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In This Guide
1. Decide which type of business you want to be
The first decision you have to make is the type of business you want to set-up. This is an important decision, as the type of business you choose will have an effect on a number of things, including the documents you need to submit and the tax you need to pay.
The three most common types of business are Limited Company, Sole Trader and Partnership.
A Limited Company separates you from your business. This means that, should your business fall into difficulties, personal items such as your home will not be recovered to pay for your company’s debts. Whilst there tends to be more management and responsibility required if you run a Limited Company, there can be professional and financial advantages.
A Sole Trader business is the easiest type of business to form. There is less paperwork than with a Limited Company. However, you will be personally responsible for the business, so if your business runs into debt, then your personal items will be taken to cover those debts.
Finally, a partnership business is much like a Sole Trader business, however it applies when you have 2 or more people. Like Sole Trader businesses, all parties will be responsible for the business’ debts, so it is important that all parties understand the risk before entering into a Partnership.
2. So which type of business should you choose?
It is important to think about the business you want to build and how your business will ideally look in the next few years. Whilst it is possible to switch from one type of business to another, you may find it easier to set your business up in the form that you intend to keep throughout the life of your business. As with most things, there are advantages and disadvantages of each form of business:
Advantages of a Limited Company
- No personal liability – If your business runs into trouble, your personal assets will not be at risk.
- Tax efficient – Unlike as with a Sole Trader, you can pay yourself in Dividends as a Limited Company director. Dividends are taxed at 7.5% (at the lower band), which is less than the 20% Sole Traders need to pay in Income tax.
- Strong professional identity – For many clients, especially B2B, they prefer to deal with Limited Companies. This is because Limited Companies have to be more transparent in their operations, adding to the trust clients have in Limited Companies.
Disadvantages of a Limited Company
- More complicated to set-up – In addition to registering with HMRC, you will need to register the company with Companies House, which also attracts a small fee.
- Annual accounts – As a Limited Company, you are also required to complete more detailed accounts of your business. You will need to ensure your accounts are up to date on an annual basis, including tax returns and business expenses.
- Public records – As a Limited Company director, you will need to add your personal details to the public records in Companies House. This includes name, date of birth and address (though you can use an alternate address, see Obligations of a Limited Company for further details).
Advantages of a Sole Trader/Partnership
- Easy to set-up – There’s no need to inform Companies House. You simply need to inform HMRC that you are now self-employed and will be earning more than £1k in a tax year. To inform HMRC, visit the Government portal.
- Better privacy – No registering with Companies House means that, unlike with a Limited Company, you don’t have to provide any personal information for display on public records.
- Low start-up costs (Depending on your company’s industry) – To register your Sole Trader business with HMRC is completely free. Therefore, from a company formation perspective, there are zero start-up costs.
Disadvantages of a Sole Trader/Partnership
- Not as professional as a Limited Company – Some larger companies may not wish to deal with Sole Traders, where there is less publicly available information about the company. So if you plan on dealing with large, corporate clients, a Sole Trader business may not be the right company formation choice for you.
- Unlimited liability – Your personal assets are at risk if you run into debt with your business.
- Not as tax efficient – As with an employed individual, you are given a personal allowance of £12,500 that is income tax free. Any income over this is then taxed at normal rates. Limited Company owners can take Dividends, reducing the amount of personal tax they pay.
3. Forming a Sole Trader Business
As a Sole Trader, there are fewer steps you need to go through to set-up a business.
To begin, you need to inform HMRC that you will now be paying tax through self assessment. You’ll then need to file a tax return every year. You can register for Self Assessment here.
Next step is to name your business. Unlike with a Limited Company, you are not required to register your name. Choose a name that reflects your business. You can even choose your own name as the company name. Just make sure that you don’t use LTD or Limited and that the name hasn’t been trademarked. Also ensure that you put your business name on your official paperwork, such as invoices.
Otherwise, that’s pretty much it for forming a Sole Trader business!
Responsibilities of a Sole Trader
There are a few tasks you need to complete on a regular basis:
- Keep records of your incomings and outgoings
- Send a self assessment each year
- Pay income tax on your profits
- Pay your Class 2 and Class 4 National Insurance
If you’re starting a Sole Trader company, you can skip sections 4, 5 and 6 of this guide, as they’re specific to Limited Companies only.
4. Forming a Limited Company
If you have chosen to form a Limited Company, you will need to follow the below process. Ensure that you have all the below information prepared and ready before you register your company on Companies House. If you’re struggling with Company formation, get in touch with iFinance Department who can help you through the process.
Choose your company name
First things first, you need to select a name for your company. This needs to be an original name, and therefore can’t be one already used on Companies House. Note that you can have a different trading name to your company name on Companies House. Again, be wary and ensure that your trading name isn’t similar to that of another company. Trading names cannot end in Limited or LTD.
The name of your company can’t be similar to one already registered. So, for example, ‘Windows 4 U LTD’ would be the same as ‘Windows for You LTD’.
Your company name must end in either Limited or LTD. The only exceptions are:
- Your company is a registered charity
- Your company is a regulator of commerce, art, science, education, religion, charity or any profession
- Your company cannot pay shareholders
- Your company requires each shareholder to contribute to company assets if it is wound up
It is a good idea to check the availability of your company name both through the company name availability checker, as well as through a domain checker. You want to ensure that your website address reflects your company name as much as possible, so check that your preferred domain name is available before you commit to the name of your company.
You can check the availability of your company name here.
You can check the availability of your website domain address here.
Choose your Directors and a Company Secretary
Your company must have at least one Director. All Directors within a company are responsible for the adequate running of the business. This includes ensuring management reports and accounts are correctly prepared and filed on time. Check out the Limited Company Director Responsibilities section below for more information on a Director’s responsibilities.
If you plan on running your Company with other parties, ensure that you and all other Directors are fully committed to the Company. The best chance of success is if all Directors share the workload and are pulling in the same direction.
As you’d expect, there are some rules when it comes to appointing a Director:
- They must be aged 16 or over
- They must not have been disqualified from being a Director
- They can live abroad but the company must have a UK registered office
- They must provide a service address
Appointing a company secretary is not mandatory for a limited company. However, you may choose to do so to take on some of the director responsibilities.
Next, you need to identify who will be the shareholders of your business. This is usually the Directors who hold the shares. Everyone who owns ordinary shares are then eligible for dividends, based on the portion of the shares they own and class of share. So for instance, if there are two Directors, and both are equal shareholders of the same class of share, the Dividends would be split 50/50. If you owned 10% of the shares of the company, when Dividends are issued you would be due 10% of the total amount.
Your company will likely have ordinary shares. This means you get one vote per share.
How many shares you issue at the beginning is totally up to you. To keep it simple, it may be worth issuing 100 shares (1 share per 1% of your company). This makes it easier to understand the share that each shareholder holds. If the company were to close down, each shareholder would need to pay for their shares in full. So to limit your liability, you can choose a low share value of £1 per share.
As part of the registration process of your company, you’ll need to provide a statement of capital. This includes the number and value of the shares issued, and the names and addresses of all the shareholders.
You’ll also need to inform Companies House of the rules around the shares, known as the prescribed particulars. This includes information on whether each shareholder can exchange their shares for money, how many votes they get and what they can vote on.
Prepare a Memorandum of Association and Articles of Association
There are a couple of documents that you need to complete as part of your company registration. Firstly, your memorandum of association, which is a document that details each shareholder and is an agreement of the formation of the company. Download a template memorandum of association [insert template here]
Secondly, you’ll need an articles of association document, which outlines the rules governing the running of the company. You can download a template articles of association here [insert template here]
Choose your Addresses
When registering your company, you will need to inform Companies House of your registered office, as well as the service address for each Director.
The registered office is the location that HMRC or Companies House information is sent to. This address has to be in the UK, and within the home nation that your company is registered.
Since the Covid-19 pandemic, there have been a number of companies starting from home. Your registered office is publicly available, so it might be a good idea to use an agent for your registered office. In many cases, companies will use their Accountant’s address for their registered office. This will keep your home address private, especially important if you deal with clients who could possibly look up your address!
The service address is specific to the Director. So this is where correspondence relating to the Director will be sent. Again, it is recommended that you use a forwarding address for your service address, so that your address isn’t made public. There are various forwarding companies, such as Hoxton Mix, who will allow you to choose their address as their service address and will forward correspondence on to your personal address.
Register your company on Companies House
Once you have all of the above information to hand, you can begin the process of registering your company. It is also at this point that you will register for Corporation Tax.
Registering a company costs £12 and can be paid by debit or credit card.
As well as all of the information we have mentioned above, you will also require 3 pieces of personal information for each shareholder. The information can be:
- Passport number
- National insurance number
- Town of birth
- Mother’s maiden name
- Father’s first name
- Telephone number
You can register your company here.
Once completed, you will receive your certificate of incorporation and you will be a fully fledged company!
Company Formation Documents
Once you have formed your company, ensure that you have all the correct documentation. Below is a checklist of the documents you should have. Keep these safe:
- Certificate of incorporation
- Articles of Association
- Memorandum of Association
- Combined Register
- First meeting minutes
- Share certificates
The most important document is the Certificate of incorporation. Within this document you will find your company number. This is needed when you apply for a company bank account. You’ll also need to include it on invoices to clients, so keep this number handy.
It is also important that you add your full company name, registration number and registered office address on all of your business letters, email signatures and website.
5. Limited Company Director Responsibilities
Once you have registered your company, you and the rest of your fellow Directors now have the task of operating it in a sufficient manner. There are certain Director responsibilities that you must meet. Failure to do so could lead to a fine, prosecution and disqualification.
As a Director you must:
- Follow the rules outlined in your articles of association
- Report any changes to your company, such as changes in the registered office address, Director contact details and the appointment of an accountant. You can declare any changes via Companies House.
- Keep company records, including minutes of any meetings with shareholders, loans secured against the company and purchases of shares. You are also required to keep accounting records, including tracking all incoming and outgoings. To help meet your accounting requirements, we suggest investing in accounting software. More on that within the Accounting section of this guide.
- File your accounts and tax returns on time – This can be done via the HMRC online portal, or alternatively get your Accountant to put together and file your accounts and taxes.
- Submit your annual confirmation statement – This is a simple document that just checks that the information Companies House has about your business is correct. You can submit your confirmation statement online, costing £13.
- Ensure adequate signage – This will affect you more so if you have an office or a shop. You’ll need to display a sign wherever your company operates, unless you operate from home.
- Ensure adequate business stationery – You must ensure that your company’s name, registered number and address is on all official company documentation, such as letters, invoices and websites.
6. How To Pay Yourself As A Limited Company Director
Now the exciting part. How to pay yourself as a Limited Company Director.
The first thing you need to do is register the company as an employer. You need to do this even if it is only you as the Director of the company. This is because, technically, you are still an employee. You must register before the first payday, and you can register on the Government site.
As a Director, you can also pay yourself in Dividends. Dividends are paid out of the share of your profits.
Salary payments are taxed at the usual PAYE rates. For the 2020/21 tax year, this is at the following rates:
Dividends are taxed differently. You pay no tax on the first £2,000 you receive in Dividend payment. Following on from that, you pay the below rates of tax on Dividends:
With that in mind, the most tax efficient way to pay yourself as a company director is to pay yourself using a mix of salary and dividend payments.
Note, this recommendation is based on the 2020/21 tax year. Also note, that if you are starting a business within the current tax year, and have also received salary payments from another employment, then the below will not apply. In this case, we recommend that you pay yourself in Dividends only until the next tax year.
Firstly, you should set-up a payroll run to pay yourself a salary of £793 per month. This amount will mean you don’t hit the threshold for paying any Income tax, but you’ll still qualify for state pension.
You can then supplement your salary with Dividend payments. At the lower rate, this would mean that you only pay 7.5% in tax, rather than 20% if you paid yourself with salary.
It is worth noting though, that salaries are taken as an expense, and therefore are deducted from your corporation tax liabilities. Dividends are not counted as an expense, so are not included within corporation tax calculations.
When paying Dividends, ensure that you have enough profits in the company to pay the Dividends. When you come to pull together your annual accounts, you can not have taken more money in Dividends than you have made in profits and retained earnings. This is why, if you’re paying Dividends for your income on a monthly basis, you should keep up-to-date monthly records so you know exactly how much money is coming in, and how much is going out. This will give you an up-to-date record of company performance, so you can pay yourself the correct amount of Dividends.
Be aware that at the end of your financial year, you will be required to submit your accounts. You will then need to pay the 19% Corporation tax. So factor this into your Dividends takings. You should also factor in any VAT that needs to be paid. Utilising accounting software can help you understand the true profit in real-time, after corporation tax and VAT. This will help you pay the correct Dividend amount, and mean you’re saving for your corporation tax and VAT contributions.
7. VAT Registration
Whether you’re a Sole Trader or Limited Company, you will be required to register for VAT if your turnover exceeds £85,000. This can be done easily, either through your Accountant or via the government gateway.
Your company’s VAT taxable turnover is based on the value of your sales minus items exempt from VAT. If this hits £85,000, then you must register for VAT within 30 days.
However, even if your turnover doesn’t exceed £85,000, you can still register for VAT voluntarily. This can be a good idea if your clients are VAT registered businesses, because they themselves can claim the VAT you charge on your sales. As adding VAT on to your invoices won’t affect your clients, it also means that you can claim VAT on your purchases. The net effect meaning that you actually save money.
However, be aware that if your clients are smaller businesses and aren’t registered for VAT, being VAT registered yourself will add 20% to your sales invoices. This will make your services much more expensive. So consider the clients you deal with when making this decision.
Standard or Flat Rate VAT?
If you are required, or if you have chosen, to be VAT registered, you have two options. Standard or Flat rate.
The standard scheme is the most common method of calculating VAT. This uses the standard VAT rate of 20%. With this method, you’ll pay VAT on a quarterly basis, deducting the VAT you’ve paid on expenses in that period from your paid sales invoices.
Alternatively, you can use the flat rate scheme. With this scheme, you still add 20% to your sales invoices, but you don’t deduct VAT on a quarterly basis. Instead, you pay a flat percentage rate of your gross sales. The exact amount you pay is set out by HMRC, and is dependent on the type of work that you do. The advantage of this method is that it is simple to manage, as you don’t need to make quarterly VAT records. You simply deduct the rate from your sales invoice. However, with VAT records being so simple to submit these days through accounting software, we still recommend for most businesses to use the standard rate, especially if you have a number of business expenses.
If you haven’t already reached out to an accountant to support with the formation of your business, then it is well worth investing in an accountant to support you on your business journey. Chances are, you won’t be a financial expert, so being able to rely on someone to take care of bookkeeping, company accounts, tax returns, payroll and general financial advice is extremely important. Various accountants will offer different support packages. Some will even include accounting software within their offering, so it is well worth having an initial phone call with your accountant to find out the full details of their support.
Having the right accounting software by your side will help you run your business smoothly. Accounting software can send invoices, link with your bank statements, run VAT returns and much more.
We trust Xero, as it is one of the leading small business accounting software platforms. Your time is much more valuable in actually running your business and generating sales. Therefore investing in accounting software is a smart investment. Some of the accounting tasks that accounting software supports with includes:
- Raising invoices – If you have clients on retainers, you can even set invoices to automatically send
- Automatically chasing unpaid invoices. You can set your payment terms, and if no client payment is recorded in that time, an automatic payment reminder is sent to the client
- Link with your bank account, so that all income and expenses are automatically added to your accounting software. This makes it easier for bookkeeping
- See a real time picture of your business. This allows you to understand how much you can pay in Dividends
- Record payroll runs
- Make VAT returns – With the new making tax digital scheme, having software that auto calculates your VAT returns is extremely helpful!
Accounting Documents for Submission
When your company is up and running, there are a number of documents and accounts that you’ll be required to submit. If you’re a Sole Trader, you’ll only be required to submit a Self assessment and pay your income tax and national insurance contributions.
Each individual is required to submit a self-assessment tax return. This declares the amount you have earned and also any deductions that need to be made. This will then provide the total amount of tax that you owe. Unlike employees, as a Director or owner of a business, you pay tax on a yearly or bi-annual basis, so ensure that you save in your personal bank account so that you can pay off the lump sums of tax.
Your self assessment is due on the 31st of January, and covers the previous tax year. The amount you are required to pay is also due on the 31st of January, so we recommend that you submit your self assessment as quickly as possible, following the end of the tax year on the 6th April. This is because it will allow you to understand the amount you are required to pay, so you can save up and ensure you have the money available to cover the tax.
Company Annual Accounts
Your company annual accounts are due following the end of your company financial year. Your company financial year is usually the 12 months following the incorporation of your company, however you can choose to change your financial year, for instance to reflect the calendar year or tax year.
Your company accounts are required to be submitted and corporation tax paid no later than 9 months following your year end. Therefore, as with the self assessment, it is best to get your accounts filed as soon as possible, so you can ensure the amount owed in Corporation tax is saved within your business bank account.
Your confirmation statement, which holds details of the company, must be renewed within 14 days after your year end.
Each month, you must make a payroll run. This details the amount of salary paid to each employee, plus any contributions made to that individual.
A P11D tracks expenses, payments and benefits. You must submit your P11D on a yearly basis by the 6th of July. Any tax owed must then be paid by the 19th of July every year, unless you pay electronically, when it can be paid by the 22nd July.
You must also pay any National Insurance contributions on your benefit in kind P11D submission.
9. Business Expenses
Ensuring that you claim on every business expense is vital to ensuring you pay the correct amount of tax.
Claiming for things like mileage and even using your home as an office, will all help to reduce your tax liabilities.
Below is a breakdown of all the allowable expenses you can claim on:
- Business Premises – If you have a business premise, you can claim on all costs relating to that building. This includes utilities, rent, insurance and security. If you work from home, you can claim for part of your utility bills.
- Travel – You can claim for any train tickets, bus tickets and mileage, so long as the journey was solely for business purposes. Travel expenses also include hotels, meeting rooms and meals during overnight stays. You can’t claim for commuting though.
- Office expenses – Business stationary, computers and software can all be expensed.
- Marketing – Any marketing activity, whether it be traditional or digital, can be claimed. This includes website hosting costs.
- Staff costs – Salaries, pension contributions and employer national insurance contributions are all included as a business expense.
- Legal/Accounting costs – Getting an accountant onboard is also tax deductible, as well as bank costs. If you take out business insurance, this is also tax deductible.
- Clothing – Staff uniforms or PPE can be claimed.
For capturing mileage, there are a number of apps available, such as Xero Expense or Tripcatcher. This allows you to put in your starting point and destination, and it automatically calculates the mileage and the amount you can claim for that trip. It even integrates with a number of different accounting software, so it records the expense for you.
10. Getting a Business Bank Account
You don’t want to be making purchases and getting income via your personal bank account. Even if you are a Sole Trader, it is important that you have a dedicated business bank account, to keep personal and business transactions separate.
In order to open a business bank account, you’ll need the following:
- Estimated annual turnover
- Companies House registration number
- Proof of ID for all company directors
- Full business address
- Proof of address
In the main, business bank accounts operate in the same way as a personal current account. However, there are a few things you should expect from your business bank account.
Firstly, most business bank accounts charge a monthly fee. This may be negated in some banks, who offer initial free bank accounts. It is important to understand what the monthly fee is, to make sure you’re getting the right deal.
Transaction fees are also common in business bank accounts. This may only happen on international transactions, so bear in mind the type of expenses you’re likely to incur. If you will be spending a lot of money on foreign purchases, it may be best to identify a business bank account that doesn’t charge for international payments.
As with a personal account, you may be able to get an overdraft with your business bank account. Research the amount they will lend and the fees and interest they charge.
App banking has also become more and more popular. As a business owner, it is crucial to be able to access your bank account on the go. So ensure that whichever business bank account you choose offers an easy to use banking app.
11. Hiring Staff
Now you’ve got the bones of the business set-up, you might require an extra pair of hands to help you. Below are the key steps to hiring. For further information, check out https://www.acas.org.uk/
If you don’t have the budget to hire an experienced member of staff, why not consider hiring an apprentice. Check out our guide to hiring an apprentice for further details.
Writing a Job Specification
Firstly, you need to specify the type of person you want to employ. It is crucial that your job spec is as clear as possible.
Begin with an introduction to your company. Then, use bullet points to describe the tasks that the employee will be undertaking. Finally, lay out the skills and qualities that you’re looking for in the ideal candidate.
At this point, you also need to identify the salary and any benefits you want to pay. Ensure you’ve done the maths and taken into account pension and national insurance contributions that you will have to pay in addition to the salary.
Then, use job sites like Indeed to post your job.
Following the receipt of application, you’ll have a few candidates for the role. Ensure you follow an interview process, including a face-to-face (or Zoom) interview. This will give you the opportunity to ask questions and get to know the candidates.
Once you’ve selected your ideal candidate, ensure that you run checks. You need to identify if the prospective employee has the right to work in the UK, plus it is worth running a DBS check to see if they have a criminal record.
Provide Contract Of Employment
If you are satisfied with all the checks, you then need to provide a contract of employment to the employee. This details critical details of their employment, including expected hours, salary, holidays etc. Here’s what you should include within your Contract of Employment as a minimum:
- Employer details
- Employee details
- Date of the employment contract
- Date of employment commencement
- Probation period details
- Job title and description
- Employee remuneration details
- Pension information
- Details of place of work
- Hours of work
- Employee benefits
- Holiday entitlement
- Sickness and disability
- Disciplinary procedure
- Grievance procedure
- Details about conflicts of interest
- Details about company confidential information
- Details of contract termination and notice periods
Provide Employee With Other Documentation
As well as an employment contract, you must also provide the following documentation:
- Provide a statement of employment – This document, though similar, is different to the contract of employment. It includes the conditions of employment and is usually in the form of a letter. This should include your company name, employee’s job title and description, start date of employment, salary details, hours of work, holiday entitlement, location of work, details of contract length, details of probationary periods, benefits and training.
- HMRC Starter checklist – an employee starting with your company must provide you with a P45 which they would obtain from their previous employer. They will also need to complete a Starter Checklist which is filed with HMRC alongside their first payment.
- Auto enrolment pension information
- Information about your specific pension plan
- Disciplinary and grievance procedures
Ensure you have the correct business insurance
You’ll likely need employer’s liability insurance, which covers you against claims made by employees who have been injured or fallen ill in the workplace.
Set-up Pay Schedule
You’ll have a pay schedule for your employee, which will include details of their gross pay, tax deducted, pension contributions and so on. You’ll need to ensure that you set-up a payroll run so that the employee is paid the net pay.
You’ll then need to set up a standing order to pay the employee on the agreed pay date the net amount owed.
Pay PAYE and NIC contributions
You are also required to pay over the PAYE liability to HMRC once a month. This is between the 6th and 22nd of the following month after the payroll has been filed. You will need to register with HMRC as an employer within 4 weeks of taking on your first employee.
As a small employer, you will be eligible for Employment Allowance which means that you do not have to pay the first £4,000 in Employer National Insurance. If your total Employer NIC exceeds £4,000, you will have to start paying the Employer NIC for the amount above £4,000.
Contact The Pensions Regulator
Finally, you will need to contact The Pensions Regulator and inform them that you now have an employee. At this stage, you will need to complete a declaration of compliance.
As a company director, paying into a pension scheme can help reduce your corporation tax liability. You also need to ensure you offer a workplace pension to anybody you employ, even if they’re on a short term contract.
Pension as a company director
Paying yourself a pension contribution each month from your company is a great way to reduce the profit of your company whilst still paying yourself.
Pensions are not taxed, meaning you can pay up to £40,000 per year into a pension scheme from your company and you won’t pay a penny in tax. Note, the rules are different if your income is over £150,000 per year. The pension contributions directly from a company will reduce overall profit, meaning you’ll pay less tax, however you need to ensure that the contribution amount doesn’t go over the respective employee’s annual allowance.
Offering a workplace pension
When you hire an employee, you will also need to, in most cases, offer a workplace pension. You must enrol an employee in a workplace pension if they are aged between 22 and the state pension age, work in the UK and earn £10k a year or more.
You can defer the period of paying into an employee’s pension by up to 3 months, to take into account the probation period of the employee.
The minimum amount you have to contribute to the employee’s pension is 3%, with a total contribution of 8%. So if you contribute the minimum 3%, your employee will need to contribute 5%.
To pay the pension, you deduct the amount from your staff’s pay each month. You then pay the amount into the pension scheme you have set-up for your employee by the 22nd day of the next month.
There are a number of pension schemes available to small businesses:
- The BlueSky Pension Scheme
- Creative Pension Trust
- The Lewis Workplace Pension Trust
- National Employment Savings Trust (NEST)
- NOW: Pensions
- The People’s Pension
- Smart Pension Master Trust
- Standard Life Workplace Pension
- True Potential Investments
- Workers Pension Trust
As with most things in life, it is important to protect your business. That’s why it is recommended that you take out relevant insurance policies.
Below are some of the business insurance you should consider:
- Liability Insurance – This helps protect your business from claims against injury or damage on your business property
- Business Income Insurance – If your business is affected by a fire, theft or other damage, this insurance will cover the cost of lost revenue
- Commercial property insurance – If you have a physical location, this will cover your inventory, tools and furniture
- Professional Liability insurance – If you’re in professional services and you provide support or advice that in some way goes wrong, this insurance will cover you for legal fees you might face if you’re sued.
- Commercial vehicle insurance – Much like normal car insurance, this covers you if you or an employee are at fault in an incident with a company vehicle.
14. Business Literature
Ensuring that you have the correct business literature in place is critical. Below is a list of the core literature you need. This doesn’t include marketing materials:
- Terms and Conditions – You should provide your terms and conditions of sale to every client and customer. You should also display your terms and conditions on your website
- Contract/Agreement of Services – Before working with any client, it is important that you have a contract or agreement of the services that you will provide. This should detail the exact services you will provide, as well as your invoicing and payment terms.
15. Get a website
Make sure your customers can find you! Getting a website allows you to showcase your products and services and drive business.
You can either build your website yourself or hire an agency to do it for you. There are some great website builders out there, below are some of our favourites;
- WordPress – This is our pick. You can buy a theme and then build your own website. It requires a little bit of knowledge, but you can build a site without any coding experience. WordPress gives you the most options when it comes to functionality and search engine optimization
- Shopify – Perfect for ecommerce sites!
- Wix – Drag and drop builder, if you have no confidence in building your website this is the platform for you!
Once you have a website, think about running some Social Media or Google Ads campaigns to drive traffic. It is also important to constantly optimise your site to improve its organic visibility. If you’re not confident in doing this, check out a digital marketing agency for support.
So there you have it, the complete guide to setting up a business. Starting a business can be daunting, however using the guide will help you glide through the process of setting up.
Make sure you utilise all the help and support that’s out there. If you’d like to discuss your business with an expert accountant that can provide you with tailored financial advice that can help get your business off the ground, get in touch with the friendly team at iFinance Department.