STARTING A NEW BUSINESS IN 2021
HOW TO START A BUSINESS IN 2021
Has the current Coronavirus Pandemic got you thinking that it’s time to take some control of your life back?
England entered its third national lockdown on just the 4th day of the year!
You may have been thinking about starting your own business for a while now, and the latest lockdown has given you that extra push.
Not surprisingly, the New Year always brings about positive changes for people. Whether that be getting fit, giving up the booze, becoming a vegan, the list is endless really.
But some people like to throw a bit more risk into their New Year plans and start up a business of their own. However, many people don’t know where to start when it comes to the legalities of setting up a business.
This article will summarise the key points to take into consideration when starting a new business.
REGISTERING A NEW BUSINESS
When starting a new business, you will need to register it with HMRC.
Most businesses register as a sole trader, limited company or partnership.
Sole Trader: It's simpler to set up as a sole trader, but you're personally responsible for your business debts. You also have some accounting responsibilities.
Limited Companies: The finances will be separate from your personal finances, but there are more reporting and management responsibilities.
Partnerships: This is the simplest way for two or more people to set up a company together. You share responsibility for your business debts and you also have accounting responsibilities.
WILL I HAVE TO PAY CORPORATION TAX?
If you’re operating as a limited company, you will need to register for corporation tax within three months of trading, hiring someone, or renting a property for your business.
RULES WHEN OWNING A BUSINESS 2021
Depending on your business type, you may have some responsibilities
Check whether you need:
Licenses/permits – eg. To play music, sell alcohol
Insurance
There are also rules to follow if you:
Sell goods online
Buy/sell goods abroad
Store or use personal information
WHERE YOU WORK
Will you work from home, or rent somewhere to run your new business from?
If you run your business from home you may need:
Permission from your landlord/mortgage provider
Business insurance
To check whether you need to pay any business rates
If you choose to rent somewhere to run your business from you will need:
To check your lease – you will be responsible to ensure the landlord maintains certain levels of health and safety.
To make sure the premises are licensed for the purpose you are using them. If they aren’t you can apply for permission here.
To carry out risk assessments of the workplace, such as fire, gas, electrical etc.
You will also be responsible for providing safe equipment, toilets, fresh drinking water, enough room and a reasonable temperature.
EMPLOYING PEOPLE FOR YOUR NEW BUSINESS IN 2021
You may need to employ people to take on some of the workload. There are things you need to consider when you become an employer. They are:
Paying for their National Insurance
Provide workplace Pensions for your employees
Ensure their Health and Safety in the workplace
CREATE A BUSINESS PLAN FOR YOUR NEW BUSINESS
A business plan is a written document that describes your business. It covers objectives, strategies, sales, marketing and financial forecasts.
You’ll need a business plan if you want to secure investment or a loan from a bank.
A business plan helps you to:
Clarify your business idea
Spot potential problems
Set out your goals
Measure your progress
ARE YOU READY TO START YOUR OWN BUSINESS IN 2021?
Starting your own business can be both exciting and stressful. Luckily there’s help available in the initial start-up process. We’re here to provide you with the best accounting and financial support you need.
Reach out to our professional and friendly team at Parker Whitwood to get started on your dream today.