Start a Business in the UK

Starting a UK business is more straightforward than most new founders expect — but the order you do things in matters. Get the structure, registrations and money setup right in the first few weeks and you'll save yourself months of cleanup later. This hub walks you through the practical decisions every new UK business owner has to make, in plain English and without the marketing fluff.

Pick a structure before you do anything else

Almost everyone in the UK trades as either a sole trader or a limited company. A sole trader is the simplest form: you and the business are legally the same person, you keep all the profits after tax, and you file one Self Assessment return a year. A limited company is a separate legal entity — it owns the contracts, the bank account and the debt, and you typically pay yourself with a mix of salary and dividends. There is also the partnership route for two or more people who want to keep things simple, and the limited liability partnership (LLP) for professional firms.

The right choice depends on three things: how much profit you expect, how much personal risk you're prepared to carry, and how you plan to grow. Most freelancers and side hustles start as sole traders. Founders who plan to take on clients, employees or investors usually incorporate from day one. There is no one-size-fits-all answer, and switching later is possible but messy — a short conversation with an accountant before you register is rarely wasted money.

Register in the right place at the right time

Sole traders register with HMRC for Self Assessment. The legal deadline is by 5 October following the end of the tax year in which you started trading, but registering early is sensible — your Unique Taxpayer Reference (UTR) can take a couple of weeks to arrive in the post and you'll need it to file. Limited companies are incorporated at Companies House, which is usually done in 24 hours online for £50. You'll need a company name, a registered office address, at least one director, at least one shareholder and details of any People with Significant Control (PSCs).

Get your business finances out of your personal life

This single step prevents more headaches than any other. Open a dedicated business bank account before money starts flowing — even sole traders, who are not legally required to have one. Mixing personal and business transactions makes bookkeeping painful, makes deductible expenses harder to evidence and, for limited companies, blurs the legal separation that protects your personal assets. Our separating personal and business finances guide explains the practical setup; our business banking hub covers account choices.

Set up the basics that you'll thank yourself for

Beyond the bank account, the first-month essentials are: a simple bookkeeping method (spreadsheet, free software, or paid software like FreeAgent, Xero or QuickBooks), an invoice template that meets HMRC's requirements, a place to store receipts (a folder in your accounting app or even a labelled photo album), and a calendar of tax deadlines. If you're a limited company, you'll also need to think about Corporation Tax registration, a payroll scheme if you're paying yourself or employees a salary, and whether you need to register for VAT (compulsory once taxable turnover exceeds the threshold — currently £90,000 — but voluntary registration may suit some businesses earlier).

Don't try to do everything at once. Use our new business finance checklist as a single source of truth, and tick items off as you go. The aim isn't perfection in week one — it's having a system that can grow with you.

What this hub covers

The guides below take you from the structural decision through registration, naming, the first 30 days as a director and dedicated checklists for sole traders and new limited companies. Pair them with the banking, invoicing and expenses hubs to build a complete finance setup before you take on your first client.