Starting a new business doesn’t begin when you make your first web page or sign that first client. It’s when you start legitimately researching into what you need to do to begin your own company. That research shows that you’re serious about becoming your own boss, and that moment is the beginning of your start up process.
But for someone who doesn’t know much, if anything at all, about business, then that time spent researching is going to be significantly longer than for someone who knows exactly what they are doing. So, just to help you along, here are some of the more important, and most common pieces of information you’re going to need to know, but might not know already.
Limited Or Sole Trader?
When registering your business you need to know whether you are a limited company or a sole trader. As a sole trader you and the company are basically one and the same, it does give you a little more freedom, but it also means that any financial issues you have personally reflect on to your business hindering any business loans you may need – and the same goes for the other way around. A limited company is an identity all of its own and so is separate from you and reliant on its shareholders. Following a guide to setting up a Ltd company is always a great option as it’s a slightly more complicated process out of the two options.
What Is Outsourcing?
Outsourcing is where you hire a freelancer or an outside company to complete a certain task for you. You can outsource building your website or writing the content for it. You can even outsource your accounts and bookkeeping. The difference between outsourcing and hiring a company is that the contract you have only lasts as long as it takes to complete the task and so isn’t a constant payment you need to make.
What Is Your Title?
A lot of people can’t figure out what their role is within their company. Simply put – you’re the owner. You’re never the manager, although in certain situations ‘manager’ might be a role you need to slip into. You’re not a CEO – that is a role created for huge companies that need a board of directors to manage.
How DoYou Do Your Own Taxes?
As your own boss you are required to do your own taxes. Once you have registered your company you will be given your unique tax code which you will use to complete the forms needed. It’s a rather straightforward process but incredibly detailed. If you have brought anything for you company you are able to claim it as a business expense. This includes a portion of your household bills if you work from home. Keep every receipt for proof of these expenditures.
When Will You Turn A Profit?
It’s only a miracle company that starts making a profit within the first few months. But there are some roles that allow you to earn pretty much straight away – like freelance writing. However, for most businesses, much of that initial profit goes straight back into the company either to pay for what you need to buy for your set up, or to make the business better that it already is.