So you’ve decided setting up a Limited company suits your requirements. Here’s some useful tips to help you get started and make the admin much easier in the long term.
Here are some practical steps for you to consider and take when wanting to set up a Limited company in the United Kingdom. HMRC also provide their own guides: gov.uk/browse/business/setting-up
This can be done by searching the term “company formation” and going through the process yourself. Alternatively if you would like Automated Accountancy to do this for you to ensure you get the setup right first time, we can do this for around £150+VAT, up to £250+VAT depending how complex you want the company to be.
A simple setup would typically be a couple of owners with say 50:50 ownership split and who wish to also be directors of the company.
A more complex setup might be multiple owners, like investors and family who each have different ownership splits, different rights to vote and different rights to dividends from the company.
This will be sent to the registered address you chose for your company and it is very important to keep hold of this code because it allows you to administer the company via the Companies House website.
The code will enable you to add or remove directors of the company, change the registered address, change accounting dates, file the annual Confirmation Statement and file accounts electronically.
This will be sent to the registered address you chose for your company and is just as important to keep hold of as it allows the company to make sure any taxes paid go against its account at HMRC rather than another company.
This allows the company to communicate with HMRC for its taxes like, VAT, PAYE, CIS and Corporation Tax as well as receive electronic notices rather than physical mail.
For more information visit: gov.uk/log-in-register-hmrc-online-services/register
A company is a legal entity in its own right and should not be seen as an extension of you or the other business owners. HMRC take a dim view of business owners using their own bank accounts instead of setting up a business bank account in the company name.
Considerations for choosing which bank to open an account with could be:
When the business first starts you may feel that a bookkeeping package isn’t needed; pen and paper will be good enough. However they can help you keep on top of your finances.
Some really good ones like Freeagent estimate all the different taxes in real time, making it easier to put aside money for HMRC so you don’t get behind.
Some are even free when you setup with certain banks. At the time of writing this, if you setup with NatWest or Mettle then you would get Freeagent for free for life, saving you over £300 per year on bookkeeping software.
Once you have your company name, you may need a brand and online presence to promote your offering. You might want to check out Genius Division to start because they offer support for startups, have fantastic experience with lots of sectors and are an all round great set of people.
You might need support with many areas including:
Very important for any business. It gives you and others peace of mind that should anything go wrong, there is protection. Some businesses are more risky than others, and having a good insurance policy to cover those risky areas might help you worry less and get on with running your business.
Insurance policies to consider could be:
Some sectors of the economy can be highly regulated. Make sure all your certification is registered in your business’s name by your regulator, as well as making sure anyone trading from it is covered. Remember, the business is its own legal entity that you will be working from, and so it’s important to ensure it has all the necessary licences and certifications as well as the people doing to the work.
This isn’t required straight away but it could help the business keep its costs down. Check out our Resources section for detailed information on VAT, alternatively we’d be happy to talk you through the benefits of registering for VAT, and even help you filling out the forms if needed.
For more information visit: gov.uk/vat-registration
This may not be required straight away but worth a little conversation about the benefits of setting up. This is required if you wish to employ someone so that you are able to forward any taxes that the business deducts on their pay.
For more information visit: gov.uk/register-employer
This may not be required depending on your industry, but if you plan on working in the construction sector and will be either working for subcontractors, or paying subcontractors then you will most likely need to become registered for this.
For more information visit: gov.uk/topic/business-tax/construction-industry-scheme
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