Knowledge

How to start a business

Posted on Jan 2nd, 2014 | Becoming self-employed

Despite the best efforts of programmes like The Apprentice and Dragon’s Den, starting a business remains a dream for many. Although not totally without its drawbacks, starting your own business can bring great satisfaction and a new-found sense of freedom.

If you’re amongst those brave souls willing to take the leap into self-employment, you’re probably wondering how to get started. With that in mind, here are all the i’s you’ll have to dot, and all the t’s you’ll have to cross to get that business going.

1. Choose your legal structure

We’re constantly wittering on about the differences between sole traders and limited companies, and as an aspiring startup, these are among the choices available to you as a legal structure. Generally, those two are the most popular amongst freelancers, but there’s also the possibility of operating as a Partnership or Limited Liability Partnership, should these structures suit you better.

Each of these structures come with their respective pros and cons, so explore these thoroughly before opting for your choice.

2. Register your business

Your choice in step one will have an impact here, since each legal structure requires a slightly different registration process.

Registering as a sole trader is the simplest route, which only requires you to choose a business name and register for Self Assessment. Once this is done, you’re all set. Registering and setting up as a limited company is a little more complex, as there are a few more hoops to jump through.

That said, it can still be done relatively quickly – incorporating online or via an agent taking a mere matter of hours.

Download and keep our handy PDF guide

How to Start a Business Guide →


3. Think about insurance

While not necessarily a legal requirement (although it is in some industries – something else you’ll need to check out!), it’s probably worthwhile exploring the different insurance options available as, despite involving an initial outlay, some investment here can save you considerable cash.

Professional Indemnity, Public Liability and Employers’ Liability insurance are the options you’ll most likely need, so consider your options and see which insurance policies will fit you best.

4. Stop reading this

In terms of the initial paperwork that’s about it – at this point, the only thing left to do is to get out there, generate some leads to drum up some clients and start building your business. Belief and hard work will go a long way in this endeavour. Just remember that Rome wasn’t built in a day – starting a business from scratch is a tricky old task, but completely worthwhile when you start to build up some steam.

If you need some support from like-minded bravehearts that took the self-employed plunge, you can find them in our free-to-join self-employed community, Crunch Chorus. You can also read some testimonies from those who took the leap in our Crunch Chorus Stories articles.

You can also check out our ‘Starting a business’ webinar, hosted by Crunch advisor Ben Shaefer, where we discuss 10 of the most important factors to consider when setting up a business.

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Written by Mark James

Useful tools and resources

Business guides

From understanding expenses to starting a limited company, we've a range of jargon-free business guides for you to download and keep.

Invoicing software and templates

Create, send and store sole trader invoices in a snap with our free invoice software. You can also download a selection of invoice templates for all business types.

Take-home pay calculator

Use our Take-Home Pay Calculator to work out your true earnings and see if you could save money with a different company set up.