As a start-up are you in fear of the unknown?

The last thing you want when you are starting-up and learning how to run a business is the steep learning curve that accounting software needs.

Starting in business can be a scary thing.  There always seems to be so much to know and consider.  Sometimes it is even difficult to know what the right questions to ask are.  Here's a selection that might look familiar to you:

Is my business idea a good one? – A fundamental question but one that is often never asked. Ask as many people as you can. This is the beginnings of market research but is, in the first instance, just good old-fashioned common sense.

What is my ultimate goal? – People go into business for all manner of reasons – make sure you have a clear idea of what you are trying to achieve. With aims and goals firmly in mind, planning the development of the business will be much more effective. Trying to start and grow a business without any real objectives in mind makes things much harder.

Will it be profitable? – Make sure you have a hard look at the realistic possibilities. It can be too easy to start up and make lots of sales, but if you need to make a living then it is the bottom line – the profit – which is key as well as the top line.

Surely I need a limited company? – Maybe. But, there are a number of possible structures – which is appropriate and why?

How will I get money out? – There are a number of ways. Salaries, dividends, drawings, pension contributions – all, or none, may be relevant for you. You will need to look not just to your personal financial needs but also the ability of the business to pay.

Do I need to register for VAT? – It depends on likely turnover and what it is you are going to do in business. Some activities are exempt, others outside the scope of VAT.

Who should own the business? – This might be just you or you might be in business with someone else, your spouse or a business contact, perhaps. Proportions of ownership will depend on the structure and the activities but future planning is key too.

How does the tax work? – Companies pay Corporation Tax in their own right and the directors/shareholders pay tax on salary or dividends received from the company, but individual sole traders/practitioners, partners in partnerships and members of LLPs pay income tax on their part of the profit.

I bet I need accounting software? – Not necessarily. In many cases the best way to start is with a very simple cash book. The last thing you want when you are starting-up and learning how to run a business is the steep learning curve that accounting software needs.

I’ve heard of IR35 – what is it? – A particular piece of tax law dealing, broadly, with businesses which deliver the services of one individual.

Now I am confused! It all sounds very technical. What do I do now? - Give us a call. We will help you through the technical minefield and help you get going.