How to Set up a New Business

Follow our Steps to Guide you through Setting up a New Business

If you’re considering setting up a new business in Ilkeston or the surrounding area, working for yourself or even partnering with a friend it can be difficult to know where to start, where to go for advice and how to get started!

There are of course a huge number of benefits to working for yourself, you can focus your energy on doing something you know you’re good at or something you are passionate about, you can chose to work your own hours, around childcare or other commitments, and you can control your income, earning money for yourself rather that an employer.

But there are also disadvantages that you should consider, you might have to work long hours and weekends, especially in the early days; your income may be irregular and you’ll have to manage your own tax and bookkeeping. You also won’t get employment benefits like paid holidays or sick leave.

If you’ve considered all of these factors, and you’re sure setting up your own business is a step you want to take, there’s nothing to stop you! Follow our How-To Guide to get started with your new business in Ilkeston today…

1) Decide which type of business is best for you?

The first step is to register your business, and to do this you need to know what business model is right for your enterprise. The type of business you opt for will also define your responsibilities, such as:

The most common options are:

Sole Traders

This is often the route chosen by standalone or self-employed traders. It’s the simplest option, but it does mean that you will be personally responsible for your business’s finances and debts.

Limited Company

As a limited company, you will be a director or employee of your company. Whilst this option means that your personal finances are entirely separate from the business finances, it does mean you will have additional account and management responsibilities.

Partnership

If you plan to start your business with 2 or more people, a Partnership means you’ll share responsibility for the business’s finances and debt.

If you’re not sure what the best option is for your business, there are plenty of reputable accountants in Ilkeston who can assist. Try Ilkeston Advertiser’s Find It directory to find a local accountant to help you decide which route to take.

2) Register with HMRC & Companies House

Once you’ve decided on a structure, you need to register your business with HMRC, ready to start completing your Self-Assessments and tax returns.

There are rules about how to name your business, so for example, if you’re a sole trader, you can not use phrases such as ‘limited’ or ‘Ltd’ as this will give the impression that you are a limited company when you are not. Your business name is also not allowed to be offensive, or contain existing trademarks.

Once you have your business name and structure, you can contact HMRC to register. Whether you’re a sole trader or you’ve decided to start a Limited Company, you need to tell HMRC that you are now self-employed so that you can complete Self-Assessment tax returns and make sure you pay the correct tax.

If you’re a limited company you will also need to register with Companies House.

3) Get the right licences and permits

You may need to obtain certain licences, certificates or permits to ensure your business is operating legally. So if you plan to play music or sell food for example, you will need to research what legalities apply and how you can prove you are operating legally and safely.

Other areas of your business may also be governed by legislation you will need to be aware of, for example, if you sell your goods or services online or if you store or use personal information (such as mailing lists).

4) Decide where to base your business

Will you run your business from home, or do you need a business premises (shop, storage unit, workshop, etc.).

If you decide you need to rent or buy a premises for your business to operate from, you might be liable to pay business rates. The amount you pay is based on the value of your premises. As a small or start-up business there are often discounts, and you may even be able to avoid paying business rates altogether for a period of time.

Erewash Council will send you a business rates bill for the following year in February or March every year.

To find out if you’re eligible for a reduction, or with help estimating your business rates, contact Erewash Borough Council directly.

If you are planning to work from your home, you can often claim expenses against a percentage of your home running costs to reduce your profit and pay less tax. Depending on the type of work you do and how much of it you do from home, you can claim back expenses for: Council tax, home insurance, mortgage interest or rent, telephone and broadband bills.

5) Find out what business insurance you need?

The only insurance you’re legally obliged to purchase is Employers’ Liability insurance if you employ staff. This covers you in case an employee has an accident whilst working for you.

You may also want to consider:

Public liability insurance to cover you against claims from members of the public.
Professional indemnity insurance protects you from claims if you provide incorrect professional advice.
Directors’ and officers’ cover (management liability insurance) protects the individual owners of the business from claims against them personally.
Cyber liability cover covers businesses for data breaches and cyber attacks.

6) Fund your start-up business

How are you going to fund your business? Perhaps you have everything you need, or maybe you need to invest in equipment, premises, staff, etc.

As a new or start-up business you may be eligible for financial help to get you started. This will depend on the region you’re in, what type of support you require (grants, loans, etc.) what industry you are in, the stage your business is at (not yet began trading, start-up with 1-2 years trading, or fully established) and the number of employees you have.

Use the .Gov website to find out what finance and support is available for your business.

7) Build your online presence

Whether you want to advertise your services or products online, connect with customers on social media, register on online directories or set up a business email address for your clients to contact you, the best option is to build your online presence so your customers can find and research you.

Business Email Address

Having a proper business email address will reassure your potential clients that you are a trustworthy and professional business.

Website

Many people will Google a business before choosing to contact them, either to check that they offer the services they need or to make sure they appear reputable and professional.

Whether you want a full brochure website site that provides a full list of all your services and products and information about your business, or a single landing page website so you can begin to market yourself and show up in Google searches. A wellbuilt professional website that ranks in Google doesn’t have to be expensive, but it does need to be designed and set up properly to be effective.

Social Media

Once you have a website and business email address, you can look into setting up business social media accounts. Facebook, Twitter and Instagram can help you connect with your customers in an informal way, you can chat with them, answer their questions and make new connections.

For more information on building your online presence, contact your local web design and digital marketing agency, Evolution Media for advice and affordable products especially designed for new businesses in Ilkeston.

We Can Help Get Your New Business Off The Ground

Not sure where to start with your new business website, branding and digital marketing? We can help you, please contact us today.

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