Most people believe that when they set up in business they have to jump through a lot of hoops including registering the business and employing an accountant etc. The truth is, it doesn’t have to be that way! Here’s a simple guide to setting up your own business:-
1st – Decide on a Company name, it doesn’t have to be unique (although this does help with marketing) and it doesn’t have to be trademarked (trademarking can be costly).
2nd – Register the Company – this can be as a Sole Trader, a limited company or a partnership.
As a Sole Trader you will be responsible for the business debts and you must register for tax Self Assessment if your business turns over more the £1,000 per year. You will need to file a tax return each year. An agent for HMRC (bookkeeper/accountant/TLC Virtual Assistant) can do this for you if you find figures daunting.
As a Limited Company, the businesses finances are separate from your personal finances. Accounting becomes a little more in depth for a Limited Company, but a bookkeeper or an accountant can help. TLC VA is able to help here too! If the company turnover is less than £10.2million then it will not need to be audited and accounts can be completed by a bookkeeper or yourself rather than an accountant. Accounts must be submitted to Companies House as well as HMRC, these can be abridged if turnover is less than £10.2 million.
A Partnership is the simplest way for two people to run a business and you share responsibility for the business debts. One of the partnership must be nominated as being responsible for the accounting of the business, in all other ways accounting is the same as with a Limited Company.
3rd Ensure you have all insurances in place, Professional Indemnity, Public Liability etc. and any licences you may require (for instance if you play music in a public area – you will need a PRS licence)
4th If you are concerned about maintaining your own accounts, contact TLC Virtual Assistant or a bookkeeper/accountant. They can take the pressure off you!
Remember to keep all your receipts for purchases for the business as you will need these to claim back expenses and include them in your accounts.
Having clear accounts, completed on a monthly basis, helps you keep on top of the businesses finances. You’ll know your own cash-flow, you’ll know where to make savings. you’ll know your best selling products, the list is endless. You need to know your business, to help grow your business and completing accounts monthly will help you do this. Furthermore, you may need to register for VAT. You must register if, by the end of any month, your total VAT taxable turnover for the last 12 months was over £85,000.
If you would like any assistance or advice on starting up your own business and/or require assistance with your accounts TLC VA is always here to help. It’s not that daunting, but having someone on board who understands all of the systems is such a help, and really does take the pressure of you, leaving you able to run your business and do what you do best!