New Year – New start: Setting up a business in the UK

Living in a post pandemic world, coupled with the effects of recession, appears to have driven many more people to consider the benefits of being their own boss and starting their own business.

Got the idea and motivation to succeed?

Stephen Attree, Managing Partner of MLP, explains the next steps.

Starting a business in the UK can be a challenging but rewarding experience. There are a number of important legal, accounting, and employment law considerations to keep in mind, as well as the process of finding suitable premises.

First and foremost, it is important to choose the right legal structure for your business. The most common options in the UK include sole trader, partnership, limited liability partnership (LLP), and limited company (Ltd). Each structure has its own set of pros and cons, so it is important to consider factors such as personal liability, tax implications, and administrative requirements. A sole trader, for example, has complete control over their business but is personally liable for any debts. A limited company, on the other hand, offers limited liability for the shareholders but requires more paperwork and reporting.

Once you have chosen the legal structure for your business, unless you are setting up as a sole trader you will need to register it with Companies House. This process involves providing information such as the business name, registered office address, and details of the directors and shareholders. It is also necessary to obtain any necessary licenses or permits depending on the nature of your business. For example, if you are planning on selling food or drink, you will need to register with your local council and comply with food safety regulations.

Next, you will need to consider accounting and tax requirements. As a business owner, you will need to keep accurate records of your income and expenses, and file regular tax returns with HM Revenue and Customs (HMRC). It is important to keep up with these obligations to avoid any penalties for late or incorrect filings. You may wish to consult with an accountant to ensure compliance and also to maximise tax efficiency.

Another important aspect to consider is employment law. This includes things like minimum wage regulations, working hours, and holiday entitlements. You will need to ensure that you are providing a safe and healthy working environment for your employees, and that you are adhering to any other relevant laws and regulations. You will also need to keep records of employment contracts and employees’ details for legal compliance.

Finally, one of the most significant and practical aspects of starting a business is finding suitable premises. This can be a challenging task as it involves balancing factors such as location, cost, and size. You will need to consider things like accessibility, parking, and the needs of your business. Some businesses are able to operate from home, but other require a physical shop or office. It’s important to take into consideration all your business need when selecting a location, whether that’s footfall, the cost of the rent or even the need for a specific type of location such as a warehouse, factory or even storage space.

Starting a business in the UK can be a complex and challenging process, but with the right planning and support, it can also be incredibly rewarding. It’s important to consider all legal, accounting, and employment law aspects in addition to finding suitable premises. It’s always a good idea to seek professional advice from lawyers, accountants, and other experts to ensure you are fully compliant with all relevant regulations, and to give your business the best chance of success.

For more information or to request a copy of our guide to starting your business, please get in touch:

commercial@mlplaw.co.uk

Stephen Attree – stephena@mlplaw.co.uk