This package includes: Registration as a self-employed in 2-3 weeks Practical advice and guidance to help you get your business off the ground Initial consultation free-of-charge Preparation and submission of the appropriate forms to Inland Revenue to obtain National Insurance Number and PAYE Provision of specialised account books, seals and other stationeries (additional fee) Payment of legal and initiation fees The following documents will be posted to you (these documents will be sent via Royal Mail): Written confirmation letter from the Inland Revenue
Business Start-Up: Legal Requirements
When you start working for yourself, you will need to register as self-employed with the Inland Revenue. Once you are registered as self-employed, you will be a Self Assessment taxpayer. You can trade under your own name, eg John Doe, or use another business name, eg AAA Business Marketing. If you are self-employed, you are responsible for paying your own tax and National Insurance contributions. You will need to keep business records and details of your income so you can fill in an annual tax return. If your business turnover is more than the VAT threshold (£61,000 from 1 April 2006) you will normally have to register for VAT. You pay Class 2 NICs at a flat rate of £2.10 a week (2006-2007) if your earnings are above £4,465 per year. Bear in mind that Class 2 NICs do not count towards the additional State Pension, Statutory Sick Pay or Jobseeker's Allowance. Key dates for self-employed tax: 30 September: sending in your paper tax return if you want HMRC to work out how much tax you owe. 31 January: sending in your tax return to avoid a penalty. 31 January and the following 31 July: tax payments.
WAYS TO RUN A BUSINESS: BUSINESS SUPPORT, INFORMATION AND ADVICE
You are not alone if the thought of running your own business has crossed your mind. Even if your vision of a small business differs from your neighbor's, you probably dream have being your own boss and of providing a needed service or creating a cool new product.
However, your very first small-business decision may be to admit that you are not ready for this career - at least not yet. If you are straddling the fence, Coddan CPM will uncover whether this career works for you. You will also gain insight into getting your personal finances in order before exposing yourself to the risk of a new business, and discover how to draw a roadmap to reach your career destination. This easy-to-understand guide is also for those who want to start a new business.
To start a business you will need to choose or create a business plan. While this is an obvious step many people who want their own business don't have an idea, just the desire to be an entrepreneur. For the budding entrepreneur, there are many options; buying a franchise or an existing business, or looking to others for ideas for a start-up business. Once you have decided on the business you wish to start, then the real work begins. The simplest form of business entity is the sole proprietorship. If you choose this legal structure, then legally speaking you and the business are the same. Establishing a sole proprietorship is cheap and relatively uncomplicated.
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We also answer your business questions by running a website and a telephone call handling centre (between 9:30 AM and 17:30 PM, except holidays): 0800 081 1510 or +44 (0) 207 637 3881, fax: +44 20 7681 3318. We may answer your questions at our main office in central London (W1, 5 Percy Street) - free of charge for first-time business starter entrepreneurs. Our consultants and business start-up advisors speak English, Spanish, Italian, and Russian. Please do not hesitate to contact us directly and apply for a meeting with us if you have any questions. We see too many investors who might have avoided trouble and losses if they had asked basic questions from the start. If you would like to arrange a meeting to discuss how to start your own business, tips on funding, employing people and the biggest causes of failure for start-ups, please contact us.
It does not matter if you are a beginner (small or new business start-up questions - your first knowledge search answers are free of charge!) or have been investing for many years (professional questions about tax planning, business planning, tax optimisation cannot be answered free of charge); it is never too early or too late to start asking questions. It is almost impossible to ask a dumb question about how you are investing your money. Do not feel intimidated. Coddan CPM offers assistance and resources for those running or starting a business in England, Scotland, Northern Ireland or Republic of Ireland. Coddan CPM also offers business-planning, companies incorporation, accounting and consulting services in USA and offshore countries.
Start a Business in England, Scotland or Ireland, small business advice, business planning in London (UK), Edinburgh (Scotland), Belfast (Northern Ireland) or Dublin (Republic of Ireland). Setting up and running a business is a time consuming task - you need to be dedicated and focused and able to structure your time in order to be successful. The rewards of starting up your own business can be great, but think carefully if you have the attributes and right sort of personality to cope with going it alone.
Setting up a small business involves a number of important steps if you want to get things right first time. There will always be an element of trial and error in starting up a business; however we hope this overview will guide you through the initial steps, based on the experiences of the Coddan CPM team and our contributors.
Of the four million businesses in the UK, over 99% are 'small' (0-49 employees), according to government data. At the start of 2003, 46.2 per cent of business employment was in small businesses. Even more interesting is the fact that 2.9 million of these small businesses have no employees at all - the majority of small businesses are operated by individuals, or by a small group of people. Small and medium-sized enterprises (SMEs) together accounted for more than half of the employment (58.2 per cent) and turnover (52.4 per cent) in the UK. In the UK today, over 2.5m businesses are sole proprietors, around a million are limited companies, while some 540,000 are partnerships. But which is best for you?
CHOOSING THE BEST OWNERSHIP STRUCTURE FOR YOUR BUSINESS: SOLE TRADER (SELF-EMPLOYED)
You should think carefully about which structure suits your particular circumstances before making a decision. Choosing the wrong structure could expose you to unnecessary costs and risks, while failure to address certain practical issues may result in you falling out with your business partners or associates. Having said that, the status of sole trader suits many professions where starting up does not require major investment, and where a skill - such as carpentry, bricklaying or freelance services - is just as important as business acumen. It will not stop you from employing people when you start to get busy, but it will allow you to keep a tight grip on your business and to run it as you wish.
Today, there are several business entity options available for entrepreneurs. Like anything else, each of them has advantages and drawbacks:
Sole Traders:
General Advantages of UK Private Limited Companies:
1. Liability is, in the vast majority of cases, strictly limited to the investments made by the shareholders. 2. Company Officers are not personally liable for their actions unless there is a clear and serious breach of their fiduciary duty. 3. Limited companies often benefit from greater prestige than their sole proprietorship or partnership counterparts. The reason is because such an enterprise normally requires more planning and thus is deemed more credible. 4. Limited companies often benefit from significant tax advantages. In fact, many countries around the world give exclusive tax incentives to this type of entity. 5. The rights of shareholders are normally clearly defined and protected. 6. Corporate taxes only become payable after the end of the financial year. This means money that would otherwise be taxed on a monthly or quarterly basis, is available to earn further interest before the final payment of tax. 7. You need only appoint one Director and one Shareholder. 8. Directors can be corporate bodies or private individuals. 9. A Director can be of any nationality. 10. All companies must appoint a company Secretary who can be of any nationality.
Most people who start in business do so as sole traders. They work on their own. They alone receive the income and are liable for any debts. The financial costs of starting up are minimised by working alone from home. It can be a lonely life but, instead of colleagues, you have customers. Business people who work in the same town often join organisations such as the British Chambers of Commerce or networking groups such as Business Network International where they meet other people who are in a very similar situation to themselves. Talking your problems over with other people in business, provided that they are not competitors, can help.
Being a sole trader is the simplest way to get started in business (although not necessarily the best, you need to get professional advice before taking the plunge). Once you have informed the government agencies of your intentions to go self-employed, you can start trading right away (subject to any specific licences you might require in your line of work).
As a sole trader, you can quickly adapt to changes in your business with minimal bureaucratic changes required and you have complete control over your business and accounting affairs. However, a sole trader is also ultimately responsible for any liabilities should anything go wrong. It is worth spending time considering which set-up company format is best for you. As a sole trader, you will not need to notify Companies House, nor deal with any administrative or accounting requirements which are required of Limited Companies. If you start working for yourself, you must register with the Inland Revenue as self-employed, even if you already send in a tax return. There are some exceptions and special rules for particular industries, like the construction industry.
Essentially, your business income is counted alongside your existing personal income, so the accounting side of your business will be very straightforward. As the name suggests, you will be personally liable for any debts you incur in the running of your business which you wouldn't be under the Limited Company route. In terms of accounting, you will need to submit an annual self assessment form to the Inland Revenue and keep accurate and up-to-date records of all business transactions and accounts. You will also be pay income tax on all profits and pay national insurance contributions on those profits. Losses can be offset against tax on other income. In the April after your business starts, the Inland Revenue will send you a Self Assessment tax return to fill in. The Revenue will also use the return to assess any profit-related (Class 4) NI contributions you may need to pay.
Self-Employed people are also liable for Class 2 NI contributions (currently £2.05 per week). If your income from self-employment is low (below £4,215 in the tax year 2004-05), you may be able to apply for the Small Earnings Exception. Also, if you're already paying NI contributions in another job, you may be able to defer paying your Class 2 contributions until the end of the tax year.
Even though you will have registered as "self employed" when setting up, you won't automatically be VAT registered. You do not usually need to register for VAT until your turnover reaches a certain limit in any 12 months, or you expect it to do so. This limit - the 'VAT threshold' - is currently £61,000. Your annual turnover is normally the total amount of money coming into your business from the goods or services you sell. You can read our Complete Guide to VAT.
Self-Employed Advantages: Easiest and least expensive form of ownership to organize Flexibility - no requirement for registration or filing documents Fewer statutory controls Lower National Insurance costs Tax payable is Income Tax paid in two instalments. Coddan CPM can help you and advise on your self assessment tax return Profits can be withdrawn at any time without PAYE problems.
Self-Employed Disadvantages: The sole trader is the business. On the death of the sole trader, the business effectively ceases Unlimited liability: the sole trader is liable for all debts of the business May be at a disadvantage in raising funds and are often limited to using funds from personal savings or consumer loans Fewer State benefits and tax reliefs are available Weak structure There are certain businesses that will not use Sole Traders, particularly if you are a contractor Tax and National Insurance is deducted directly from your profits for the year and there is less scope for tax planning as with a Limited Company
Being a sole trader will suit a large number of small business people, however it is not always the best route which is why we suggest discussing your choices with an accountant or other adviser. The limited company route limits the personal liability of its directors if something goes wrong, whereas the sole trader is ultimately personally liable for any losses the business makes, of if you are forced into bankruptcy. In addition, in some areas of business, having a limited company setup will enhance prestige and provide a more professional appearance in certain industries.
Before you start trading you will have to decide under which structure you intend to trade. This will be dependent on the type of business you are running and how you intend to develop in the future. We have several guides and calculators that can help you through this process. Alternatively you can make an appointment with one of our consultants.
Everyone starting out on their own needs to register with HM Revenue & Customs. It's quick, it's painless and it can definitely save you time and money. You must do this as soon as you start or within the first three months, even if you already use a Self Assessment tax return. There are penalties for not registering, so fill in the form at the back of this leaflet and send it to us right away. In addition, if you are unemployed now, do not forget to tell the Jobcentre. For More Information About Being Self-Employed:Contact Us Online or call us at (+44) 0207 637 3881. To speak with a representative, please call between 9:30 am and 17:30 pm any business day.
Do I need an Accountant? Yes. An accountant will prepare your accounts in a way that is acceptable to the taxman, and will ensure that you are charged the right amount of tax. But don't wait until the end of your first year of trading before finding one. An accountant can give you valuable help in setting up your bookkeeping system; if you keep your records in the form suggested by your accountant it will make his job in preparing your accounts easier and therefore cheaper. He will also be able to help you to prepare budgets and cash flow forecasts, which your bank manager will want to see.
If you are self employed you will have to complete a self assessment tax return and pay over the first instalment of your tax liability to the Inland Revenue by 31 January each year. Coddan CPM can complete your self assessment and prepare your company accounts: self assessment only - from £125.00 (depending on the complexity of your return). Self Assessment Tax Return and Accounts preparation - from £300.00 (depending on the complexity of your return). For More Information About Accounting and Bookkeeping, Please Click:PAYE, VAT & Accounting and Bookkeeping Service
You can read more on our site about the Limited Company route and for general taxation guides, please try our dedicated the tax section. You should register the moment you start out as a sole trader; otherwise, you will incur a penalty of £100.00 if you do not register within three months. When you start working for yourself, you will need to register as self-employed with the Inland Revenue - we may do it for you! If You Are Thinking About Becoming Self-Employed:E-mail Your Questions to Us
Do I Need a Visa for the UK to Start a Business in England, Wales, Scotland or Ireland? The United Kingdom is the home of Europe's largest city and is embedded in the culture, vocabulary and dreams of English speakers worldwide. It is seen as an economic hub for trade between Europe and North America with the United Kingdom benefiting from the situation for centuries. The United Kingdom still has one of the strongest economies in the world today. The United Kingdom has a population of diverse backgrounds, given the variety of people who have settled here over the centuries. The majority of the population is Anglo-Saxon which is predominantly German-Scandinavian in origin. Since the middle of last century there has been significant immigration from many ex-colonies, especially the Caribbean, Pakistan and India. The United Kingdom has a positive view on increasing the multicultural population of the country with the amount of people immigrating to the United Kingdom increasing every year. The UK is in the process of liberalising its immigration laws and has a generally open and positive approach concerning those who wish to enter the country to work or set up a business.
British Citizens, those with Right of Abode or settled in the UK and nationals of European Economic Area countries (see Appendixes for a list of these countries) are permitted to live and work freely in the UK. All others can apply to enter the UK to work or set up in business. Nationals of certain countries, known as visa nationals, require a visa or prior entry clearance to enter the UK for any reason. Others require prior entry clearance, depending on the reason for coming to the UK. Entry clearance must be applied for at the British Embassy, High Commission or other British Diplomatic Mission which issues visas in the country where the applicant is normally and legally resident. Where there is no such post the applicant must apply to the appropriate designated post outside the country or territory where they are living. An applicant for entry clearance must be outside the United Kingdom and Islands at the time of the application.
Work Permits: A UK Work Permit is a document issued by Work Permits (UK) of the Home Office Immigration and Nationality Directorate. It gives an employer permission to employ you in a specific job at a specific location. A Work Permit is authority to take employment, but does not grant leave to enter the UK. A Work Permit holder must apply to an immigration officer for leave to enter at a UK port of arrival. A visa national must apply for a visa before travelling to the UK.
Any non-EEA national subject to immigration control who wishes to come to the UK to work must, with limited exceptions, have a Work Permit. The length of time taken to process a Work Permit application depends on the nature of the application but, as a general rule, employers should allow at least six to eight weeks. Work Permit applications should be made by the UK employer and a permit obtained before the overseas national concerned arrives in the UK. If a person arrives in the UK without a Work Permit, they will normally be refused entry. How Do I Apply? Do I Need a UK Visa?
CHOOSING THE BEST OWNERSHIP STRUCTURE FOR YOUR BUSINESS: PARTNERSHIPS
You could set up in business with a colleague or friend. Perhaps you each have different skills to bring to the enterprise. One may be a good sales person and negotiator while another has the ability to provide a service, like mending guitars, writing websites, compiling accounts, analysing markets or sculpting. When you go into business with someone else, this is usually known as a 'partnership'. Everyone might own an equal share or some may have a larger proportion of the business than others. In a partnership, you are liable for the debts of the business in proportion to how much of it is yours and your income may be of a similar proportion.
Unlike other business formats, partnerships (and sole traders) can start trading straight away, although certain types of businesses may need a licence to trade. If trading under a name other than that of the owners, must display names of owners and an address, for each, at which documents can be served. Behind sole-traders, a partnership is the second most popular type of business and is more commonly associated with professional services such as accountants, solicitors and doctors. It is also common in partnerships for each partner to specialise in a specific area of the business. For example, in an accountancy service, one partner may specialise in bookkeeping, another partner may specialise in financial advice, and so on…
You have to be aware that because any decisions and actions are dependent on the other partners agreeing, certain conflicts may arise from time to time. Such conflicts have led to partnerships failing and so it
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Business Start-up for Beginners
£ 25.00
This package includes:
Registration as a self-employed in 2-3 weeks
However, your very first small-business decision may be to admit that you are not ready for this career - at least not yet. If you are straddling the fence, Coddan CPM will uncover whether this career works for you. You will also gain insight into getting your personal finances in order before exposing yourself to the risk of a new business, and discover how to draw a roadmap to reach your career destination. This easy-to-understand guide is also for those who want to start a new business. 
You should think carefully about which structure suits your particular circumstances before making a decision. Choosing the wrong structure could expose you to unnecessary costs and risks, while failure to address certain practical issues may result in you falling out with your business partners or associates. Having said that, the status of sole trader suits many professions where starting up does not require major investment, and where a skill - such as carpentry, bricklaying or freelance services - is just as important as business acumen. It will not stop you from employing people when you start to get busy, but it will allow you to keep a tight grip on your business and to run it as you wish. 
+44 (0) 141.530.8188 
+44 (0) 289.099.8744 
Easiest and least expensive form of ownership to organize 
