Firstly, huge congratulations! Welcome to the world of being your own boss and following your dreams. We are sure you are raring to get going and we totally get that but we wanted to share our top tips with you to help your business start up and scale up.
1. Sole trader or limited company – it’s a tough question and often dependent on not just your turnover/profit but what industry you are branching into. There are benefits to both of course but broadly speaking:
Sole Trader – If it’s just you on the team and you are setting up a service based business i.e. graphic design, web development, VA etc then it would be a good place to start as a sole trader. Be mindful of your profit and how quickly you forecast to scale.
Limited Company – If, for example, you are planning to buy properties, do them up and sell them on for profit it would be more beneficial to set up as a limited company to begin with. You are dealing in large sums of money and therefore more likely to need to register for VAT a lot sooner.
2. Get and accountant – well, of course we are going to say “pick us!” but in the interest of impartial advice…shop around and find who is right for you. Trusting another person/business with your finances is a big step and it’s incredibly important that you feel comfortable with your accountant. The more information you can share the better – they will be able to give you the best guidance. There shouldn’t be any judgement from your accountant they are there to guide and anything you share is confidential.
3. HMRC – regardless of whether you set up as a sole trader or a limited company you will be required to register with HMRC. If you are unfamiliar with HMRC then this is something your accountant can do for you. Failing that, you can set yourself up very easily online: https://www.gov.uk/log-in-register-hmrc-online-services/register
4. Banking – in the first instance, speak to your own provider…our suggestion would be to set up a business bank account and run all of your expenses (business only) through that. It makes for efficient bookkeeping which (in the long run) will make your life easier.
5. Speaking of bookkeeping – there are lots of different software options available to record your expenses and set up invoices from. We are proud to say that we are platform neutral and can advise you on which software your business would be most suited to. Examples of software are: Sage One, Xero, Kashflow, Sage 50 and Free Agent (Natwest customers only).
6. Enjoy it – allow your accountant to take up the slack…if you aren’t into finances then we would recommend getting an accountant on board as soon as you can. If you would like to speak to one of our lovely team members, please do get in touch.