7 Steps On How To Start A Business In The UK
If you’re interested in entrepreneurship and wondering how to start a business in the UK, you’ve come to the right place! The UK is the perfect place to start a business and is often considered the best place in Europe to start a business. It’s a place that encourages entrepreneurship and where many self-employed company owners, sole traders and freelancers have bloomed. One example is the ever-popular clothing company, ASOS, which was actually started by Quentin Griffith, Deborah Thorpe and Nick Robertson and is now worth a whopping $12.2 billion!
Besides having the sixth strongest economy in the world and growing industries in services, manufacturing, construction, and tourism, the UK is also known for its strong business industry. However, it can be difficult starting a whole new business in the UK, especially if you’re not from Europe. This guide will explain the things you should know when trying to start a business in the UK, such as visa applications, business structures and the UK tax system.
1. Apply for a UK visa
One important thing to note when applying for a UK visa is that citizens of the European Economic Areas, Switzerland and Commonwealth countries are not required to apply for a UK visa to enter the UK if you are travelling for pleasure. You can check out this list of nationalities that need a visa to enter the UK. If this doesn’t apply to you, then your first step would be to apply for a business visa to enter the UK.
Also, the earliest you can apply for a UK visa is three months before the date of your intended move. As such, keep in mind that the processing of your visa application may take up to three weeks. Do apply in advance so that you have enough time to plan your trip and to factor in any potential delays in the issuing of visas.
There are various different business visas you can apply for when you start a business in the UK, such as the innovator visa, start-up visa, global talent visa, entrepreneur visa and investor visa. The earliest you can apply for a UK visa is three months before you enter the country and the processing time for your visa application can take up to three weeks. So make sure to apply early enough to ensure you’ll have enough time to plan your trip to the UK while taking into account the visa application process period. It’s important to select the appropriate visa for your situation and submit the required documentation to get your visa.
Find out more about the different visa types in the UK here.
2. Market research
When looking to start a business in the UK, it’s critical to spend time researching the relevant industry that you’re interested in and evaluate accordingly. During this process, you should figure out which industry you’re interested in, what kind of business you’re going to venture into and how much time, energy and money you will need to spend on your business in the UK.
If you can, reach out to other business owners in the UK and ask them important questions about starting a business in the UK and the concerns that you have. You should also calculate how much you’re expecting to spend. The average cost of launching a business in the UK is £5,000, and the cost only goes up from there. It’s important to have a realistic expectation of how much money your business will need to flourish. Remember, you’ll also need to pay employees salaries and rent for an office building if you need one.
3. UK business structures
When looking to start a business in the UK, it’s important to understand the four different business structures. In the UK, you can be a sole trader, form a partnership, form a limited company or form a limited liability partnership (LLP).
As a sole trader, you are self-employed and run the business solo. You keep all your business’s profits but are also responsible for any losses or debts. To set up as a sole trader, there are specific requirements that you have to meet and file a tax return every year. Check out how to register as a sole trader here.
If you’re looking to form a partnership, you and your business partner will share responsibility for the business such as any losses or bills. However, your partners will also share the business profits and pay their own share of taxes. To find out more about setting up a business partnership, head over here.
Find out more about the various business structures in the UK here.
4. Have a business plan
A business plan is essential in helping you determine your business idea and set milestones to check your business’s progression. It is a written document about your business, outlining the path that you desire your business to take and also project a few years ahead to determine how your business would be doing. It will also help you spot potential obstacles in your path in the future, and how you can overcome these problems. You should write out your objective, strategy and marketing techniques.
If you’re starting a new business from the ground up, a business plan is critical for the future of your business. Your business plan should determine what type of business you have, your business structure, the targeted demographic, products or services and expected profits. Writing your business plan will help you determine if your business in the UK will be successful, and also point out any flaws or errors before you actually launch your business. So begin your business plan along with market research, and then start establishing your business by getting the necessary licenses. As everyone knows, if you fail to plan, you plan to fail.
Need some inspiration? The UK government site here has business templates and also guides you on how to write a business plan.
5. Choose a place
The United Kingdom is made up of four countries – England, Scotland, Wales and Northern Ireland. After writing your business plan, your location should be based on your targeted demographic. Once you’ve chosen a good location, it will serve as your base of operations and where your business truly begins. You can either lease an existing space for your office or perhaps build your own.
6. Making the move
Moving countries is always a difficult thing to do. Moving to the UK must feel far from home, especially if you don’t live in Europe. However, if you’re planning on moving to the UK anytime soon, rest assured you’ll feel right at home there. For many global citizens, moving to the UK is a popular choice because of its cultural diversity. The UK welcomes people from all over the world, and in fact, there are over 250 languages spoken in London alone, making the capital one of the most linguistically and culturally diverse cities in the whole world!
You’ll surely be at ease with your new business partners and employees. If you’re looking for immigration consultants in the UK, head over here.
Don’t forget to stay in touch with family and friends at home via Zoom or Facetime, so you don’t get homesick!
7. UK taxation system
If you’re not a sole trader or in a partnership, then your company must file a company tax return every year. HM Revenue and Customs (HMRC) will send your company a notice ‘to deliver a Company Tax Return’. When you file your tax return, you need to work out your company’s profit and loss for Corporation Tax and Corporation Tax bills. Companies usually hire an accountant to help prepare and file these taxes. If you have a limited company, then file your accounts with Companies House instead.
Find out more about Company Tax returns here.
All in all, these are some of the big steps you have to make for your business. If you’re looking to start a business in the UK, it requires determination, effort and a lot of patience as well. Planning and having foresight for your business is important, alongside passion and devotion.