15 Mar

Practical Guide to Setting Up a Business in the UK

There are thousands of “how to set up a business” guides out there, but most of them focus on the intangible things – planning, marketing, sales and growth.  Having been through the process a few times I wrote myself a small procedure or checklist for the more practical aspects of setting up a new company – what actually needs to happen.  It’s not difficult, but first time around I missed a few of these steps and suffered extra admin work and in some cases costs as a result.

So here’s what I’m going to assume you, being sensible, have done before you even think about forming a company:

  • realised you have a product or service that can be sold for money
  • checked that there are enough people who would actually buy it
  • worked out how you would deliver it, and how much it will really cost to do that
  • worked out an agreement with any business partners
  • checked that any suppliers are in place and what their prices would be
  • you understand the basics of accounting – invoicing, profit+loss sheet, balance sheet

So here is my checklist, with notes:

  • choose a name, making sure the URLs (“domain names”) you want are available (I recommend .co.uk for a UK business but try to register the .com as well, if available)
  • search for the name on Google (put quotes around it if using multiple words) and see what other people are using that name for – make sure no competitors have the same name
  • for a UK business, make sure the name is free at Companies House if you’re setting up a Ltd company
  • register the domain name(s), for example with 123-reg.co.uk registering them as personal domain names at your home address for now
  • set up an email address for yourself – eg. YOURNAME@
  • set up email aliases to use – info@, sales@ and accounts@ will do
  • set up the Ltd company – don’t use your accountant and don’t fill in paper forms – the simplest option is to use an online service such as companyregistration.uk-plc.net who offer a same-day service in most cases.  Register everything to your home address initially.
  • now that you have the company registration details, set up a bank account – most banks are offering free or nearly free banking for startups, and generally you’ll get a current account and a savings account
  • if you will be selling to the public straight away, apply for VAT registration – you can do this online.  Set your registration date to be when you realistically expect to start trading
  • register with Companies House Webfiling service, using your company authentication code provided when you registered the company – it will ask you if you want to register for PROOF, which you should do – this prevents people from filing fake paper documents
  • set up a bookkeeping system.  Don’t bother with Sage, it’s far too complex and unwieldy.  If you want a simple, easy to use Windows-based single-computer solution, VT is the bookkeeping system you want.  However I would strongly recommend going for an online solution such as Kashflow for book keeping – very easy to use, automatically email invoices, good online help and the best part is that your accountant can also log in to do your year-end accounts
  • get an accountant – even as a startup, having an accountant will help ensure you pay the right amount of tax and submit the correct documents to companies house on time.  I recommend MacMahon Leggate for accountants in Burnley.
  • get a phone number that can be public – a Skype Online Number allows you to have a landline number in almost any major city that you can answer on your PC, or you could try a non-geographic number
  • get a basic website set up.  Give yourself a head start and set up the site with WordPress – most ISPs will provide an option in your control panel to install this easily.  There’s a great wordpress user guide and training courses available from Interconnect IT, but the user guide is plenty to get you started.  Choose a free theme and add a few pages about the business and some contact info
  • set up a Google account and then register with Google Analytics, Google Webmaster tools
  • in your WordPress site, add a Google Analytics plugin and enter your “UA” code
  • write some pages about the products and services

At this point I’ll stop the “setup” list, because we’re moving into marketing which is well covered in many online tutorials.

Once the business has made a bit of money, there are a few things you can do to help it along.  Let’s assume again that you’ve got the intangible things covered, such as:

  • a solid, measurable marketing plan
  • good customer relationships
  • quality control of the service or product
  • a plan for growth
  • legal help with staff hiring

The practical things you can do at this stage are:

  • register a trademark for your company and/or product name
  • if you have created or are creating something unique, ask your accountant about Research+Development tax relief, and consider applying for a patent if you have enough funds
  • register some more domain names – variations on your company name, product names – and redirect them to the appropriate page on your website, or set up a “micro site” for specific products and services if you have a wide range
  • document the sales, delivery and customer services processes to help you get away from day to day operations and make staff more self sufficient

That’ll do for now.  I’m in the process of building my 2nd, 3rd and 4th companies so I’ll try and come back to this list as I learn more.

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