Who doesn’t dream of starting a business to become self-independent? It shouldn’t come as a surprise that self-employed individuals are more than ever. However, starting a business means you have to deal with financial, legal, and other risky elements.
Here are some of the most practical considerations that you should take into account before starting a new business:
Select the ‘Right’ Business Structure
It might just be the most crucial decision for your business. And that’s because each type of business structure has its separate advantages and disadvantages. The choice you make here will ultimately impact how much taxes you will have to pay at the end of the year. Not to mention the wrong business structure can force you to face legal repercussions. Therefore, don’t practice haste when it comes to deciding your business structure.
Follow the Rules and Regulations
Preparation, that’s what it takes to start a new business. And part of that preparation has to do with learning about business rules and regulations in the UK. Consequently, it will help you form realistic expectations and comply with federal authorities. For instance, if you’re thinking about hiring new staff, you will have to acquire certain licenses and insurances.
Make Sure You’re Tax Compliant
For the sake of your new business, you will have to improve your tax compliance game. You are, after all, embarking on a new journey. Therefore, figure out exactly how much you will have to pay in taxes and under what conditions. In addition, don’t confuse corporate taxes with your personal taxes.
That said, if you’re self-employed right now, you can expect to pay tax on your income at the end of the year through self-assessment tax procedure. Also, you might have to register and decide which VAT scheme is suitable for your start-up business. And don’t forget to memorize the annual tax deadlines and penalties.
Set a Realistic Budget
There’s a good chance you might already have some good budget ideas. However, assess your situation repeatedly to see if you need to make more adjustments. For example, you may need to add and cut costs from your marketing budget regularly. And how you market your business will make all the difference in the UK.
Get the Necessary Equipment
Although the requirement of the equipment inherently depends on the nature of your business, you will still need to get essential equipment like desktop PC, laptop, or any other software that you might need to conduct business operations. Similarly, you will need to get a modern phone system and furniture. A piece of good advice would be to maintain receipts for all your purchases for the offset purpose.
Wrap Up: Hire an Accountant
Sure, you can take care of your business tax returns and accounting. But it is highly suggestive that you get the expertise of a professional accountant who can segment and simplify your expenses, income, and taxes altogether. In fact, it is the safest precaution you can take that will help you save money and time for years to come.
We can help with all of your business and personal tax and financial planning needs. For a strategic review of your finances, please contact us.
Disclaimer: We don’t take any responsibility for actions taken based on above information. Please speak to our consultants if you need more information. This guide was written specifically for Smart Accounting clients. Some of the information contained in this guide might not be applicable if you do not have a business managed by Smart Accounting. By necessity, this briefing can only provide a short overview and it is essential to seek professional advice before applying the contents of this article. No responsibility can be taken for any loss arising from action taken or refrained from on the basis of this publication. Details are correct at time of writing.