If you\u2019re launching a business by yourself, setting up a sole proprietorship is your simplest option. It\u2019s far less complicated than setting up a corporation.<\/p>
However, there are still a number of essential steps to take. In this guide, you\u2019ll learn what these essential tasks are and how to complete them.<\/p>
Technically, you don\u2019t need <\/em>to write a business plan, unless you\u2019re seeking outside investment. However, this remains a hugely beneficial task for sole traders either way.<\/p> A business plan helps you to understand why <\/em>your business will be profitable. When written properly, it will help you identify and overcome potential hurdles before they pop up.<\/p> Your sole trader business plan should include the following sections:<\/p> It\u2019s recommended to review and tweak your business plan at least once every quarter.<\/p> Sole traders should register as self-employed with HMRC at the earliest possibility. You can do this by visiting the government\u2019s online registration portal<\/a>.<\/p> You\u2019ll need to decide on a business name, although most sole traders choose to use their own name.<\/p> After filling out your details, HMRC will post you a 10-digit Unique Taxpayer Reference (UTR) and login details for your online account. Keep hold of these, as you\u2019ll need them to fill out your self-assessment form online.<\/p> Most sole traders are able to work without having to rent office space. Still, if you need a dedicated place of work, there a few cut-price options. Investigate whether a virtual office, co-working space or a serviced office could meet your needs. These are typically all cheaper than renting traditional office space.<\/p> No matter what your business is, an online presence is crucial these days.<\/p> As such, you\u2019ll need to set up:<\/p> A business bank account basically works like a personal one \u2013 the main difference is that it\u2019s dedicated to your business\u2019s finances. You should therefore expect the same features, such as a debit card, the ability to make and receive payments, an overdraft option, a banking app and so on. <\/p> There\u2019s no legal requirement to open a business bank account as a sole trader, but it enables you to keep personal and business finances separate which can make things much easier when you file your tax return. You can compare business bank accounts here<\/a>.<\/p> It may cost you a fair amount to launch your business, especially if you have a lot of equipment to buy. Our guide on business financing<\/a> can help you find the best way to fund this if you don\u2019t have money saved up.<\/p> Perhaps you\u2019ll choose to set up a business bank account<\/a> with an overdraft, or a business credit card<\/a> to help set yourself up.<\/p> Make sure to keep accurate accounts of your spending and your income ready to submit to HMRC for the end of the tax year. Remember that most business expenses are tax-deductible<\/a>.<\/p> Here is a list of small business insurance products you may need as a sole trader.<\/p><\/ul>
Step 2. How to register as self-employed in the UK<\/h3>
Step 3. Set up your space<\/h3>
Step 4. Open a business bank account<\/h3>
Step 5. Setting yourself up financially<\/h3>
Step 6. You may need small business insurance<\/h3>