by Nick Robinson | Aug 02, 2013 | Business, Business Planning
As a popular firm of accountants we are often approached by people who are setting up their first business and want to know more about what they should do.
Here at Yorkshire Accountancy we have many years of experience in doing this and we are happy to provide help and advice.
The process is very simple and the UK is widely recognised as being one of the easiest countries in which to set up in business.
However, the question: ‘What do I have to register as a business?’ is usually preceded with ‘WHY do I have to register as a business?’
The answer is very simple and the aim isn’t to delay you or create more paperwork but to ensure that you are registered within the taxpaying system and will be able to pay your taxes when they become due.
Hopefully, by the time you have reached the point of wanting to register your business you will also have decided on which legal form you will take: will it be sole trader, partnership or limited company?
The easiest and most simple route to register your business in the UK is to be a sole trader.
In essence, this means that you own the business and you work alone or you employ others.
As a sole trader, you must register for ‘self-assessment’ tax which means that you or your accountant (it could be Yorkshire Accountancy or another firm) will calculate how much tax you owe. If any.
You can only become a sole trader if you have a have a National Insurance (NI) number and you must also register for self-assessment with HM Revenue and Customs (HMRC).
As a sole trader you can either trade under your name or choose a business name (be careful though because there are restrictions on what names you can use – Yorkshire Accountancy can advise).
If you have chosen your legal entity to be a ‘Limited company’ then the process is slightly more involved.
By law, you must appoint directors to the firm – these can be you and others that you know – and these names and the business name MUST be registered at Companies House.
You can have just one director and one shareholder (any other shareholders must be detailed).
Be aware too that as a director you are, in effect, an employee of the company so the firm’s income must be treated separately from your personal accounts, especially when it comes to paying tax.
You must also have a name and address for the company before you can register it with Companies House.
Finally, you will need to have articles of association – which are the rules about running the company and the firm must be set-up for Corporation Tax.
If you decide to run a business partnership then the rules are similar to being a sole trader except that more people have a responsibility to the business.
Again, you will need to register for self-assessment with HMRC, have a name for the business and share profits between your partners.
And that is effectively it – fairly easy really! Your accountant can help with the details but here at Yorkshire Accountancy we are always willing to help.
In addition, we provide cheap accountancy services and a complete bookkeeping service which is extremely popular. And remember you don’t have to be based close to us to enjoy our cracking rates!