Setting up a business or opening a new subsidiary in the UK is an exciting journey. The country is renowned for its business-friendly environment, diverse market and access to global networks.
However, setting up a business in the UK is filled with as many challenges as there are opportunities. In this guide we’ll walk you through the essential steps to establish your business.
Setting up a business in the UK
Starting a business isn’t as easy for everyone, because everyone and their ideas are different. You need to be thorough.
1. Research and planning
Before diving headfirst into setting up a business in the UK, it’s crucial to conduct thorough research and create a comprehensive business plan.
If this is your first business, don’t underestimate how much goes into a good strategy. You need to identify your target market, competitors, and unique value proposition.
You also need to determine the legal structure that best suits your business goals — sole trader, partnership, limited company, etc. Each comes with its pros and cons, from independence to tax efficiency.
2. Register your business
Registering your business is an important formal step in the setup process.
- Sole traders and partnerships need to register with HMRC.
- Limited companies and limited liability partnerships have to register with both Companies House and HMRC.
Understanding the UK tax system is vital for business owners, not only to stay on the right side of your legal obligations but to save some money through relevant tax breaks.
Make sure to check out the HMRC website to understand your obligations. An accountant will be able to help you file your tax returns, as well as identify which of a plethora of tax reliefs you might qualify for. The UK tax system is far from straightforward!
4. Business banking
Always keep your personal and business finances separate, no matter how small your venture. It will simplify accounting, audits and financial management.
5. Hiring and employment
As your business grows, you may need to hire employees, which can be costly not to mention complicated because of UK employment law and workplace regulations.
Don’t forget about your payroll system, the costs of one and the time it takes to administer it. One great solution is to outsource your payroll to a specialist who can do it for you for a smaller cost relative to hiring a full-time payroll administrator.
6. Marketing and branding
Developing a strong brand presence is key to attracting customers and building a loyal client base. It involves a range of tools, including online ones like social media and content marketing. If you’re stuck for ideas, read and ask for advice from specialist marketing professionals.
Setting up a foreign subsidiary in the UK
Expanding your international footprint could be the game-changer your business needs, especially if you bring your organisation into the UK.
To do that, there are various things to think about, like business planning, taxes, employment, etc. We won’t retread the ground we’ve already covered, so here’s what international businesses opening a subsidiary in the UK need to think about in particular.
1. Premises and infrastructure
This is something that most businesses need to do, but for large companies moving into the UK, this will usually be a harder task.
For example, you may be further away from possible business premises, making it harder for you to scope them out. You might also be unfamiliar with rent costs in specific cities and areas, so your research will have to be incredibly rigorous. Talking to property agents will be more crucial than usual.
2. Market research
You don’t need us to tell you, but in the same way that every nation and culture is different — every region in the UK is different in one way or another, so you need to be certain your product or service will work in this country and in the different regions that you might be targeting.
As such, your market research needs to be beyond thorough.
3. Register of overseas entities
If your company deals with or intends to deal with land (such as rental property), you may have to register on the Register of Overseas Entities.
Companies must also inform Companies House of who their registrable beneficial owners and managing officers are. All of this is designed to increase transparency in UK land ownership.
Need help with setting up a business?
Setting up a business is tough, whether it’s your first or tenth venture. It is also important to remember that seeking advice in advance of taking certain actions will pay dividend. Some actions are hard to alter or rectify at a later date. That’s why you should always seek professional advice!
If you would like to speak to a member of our London Accounting Team about setting up a business and your future accounting requirements contact us or telephone us on 020 3697 7147. Or you can visit our web chat in the bottom right corner which is manned during office ours and you can leave a message out of hours.
The RPGCC team are always just a click or call away.