10 Tips For Your First Year in Business
We all know that striking out on your own is a very big step – not to mention a scary one! So, we have compiled a list of our top ten tips for surviving your first year in business: every step counts!
10 tips for your first year in business
1) Plan Ahead:
It is important to know what bills you have to pay and how much profit you need to generate in order to survive. It is also useful to put a percentage of your income aside in order to contribute towards the tax due on any profits.
2) Set goals:
What do you plan to achieve in the short, medium and long term? By setting targets and more importantly reviewing them, you can monitor your successes and also identify areas for improvement.
3) Know how you are Taxed:
How you are taxed depends on the structure of your business. Those that are self-employed will pay tax and national insurance based on profits, whereas a Limited company pays corporation tax on profits.
4) Know your Deadlines:
It is vital to know when your accounts, tax returns, VAT returns etc have to be filed and or paid. Failure to submit on time can be very costly and the fines, penalties and interest can soon add up. Keep up to date with our tax calendar.
5) Record Keeping:
Little and often is the key, you may find that initially there are not many transactions. This is the perfect time to get into good habits. By recording receipts regularly you will have more control over your finances, up to date figures and you can review the performance to date. This also means that at the end of the month your accounts will be filed and you won’t still be putting your receipts together.
6) Set up a Separate Bank Account:
If you are a Limited Company, then you should have a separate bank account. If you are self-employed, it can still be a really good idea to have a separate bank account for the trade so that business and personal expenditure is kept separate. This also prevents business expenditure being missed.
7) Hire an Accountant:
It is always a good idea to find yourself an accountant during your first year in business or before – your accountant can advise you on self-assessment, deadlines for registering with HMRC, keep you on track with deadlines and provide general support in the first few months when everything is new. Most accountants offer a free initial meeting.
8) VAT Registration:
Generally you must register for VAT if your turnover in a rolling 12 month period exceeds £82,000 (the threshold in April 15). You can voluntarily register for below this level of turnover. However failure to register in time can be costly, so this is an area worth reviewing regularly.
9) Ask Questions:
There are no silly questions! If you don’t know the answer then it is an important question and one that could potentially help you in the future.
10) Build Up Contacts:
Networking is a key tool to finding out potential new leads and spreading the word about your business. This can be achieved by attending local networking groups or by using the Internet to your advantage. Use LinkedIn and get involved with online forums as it all helps spread the word and positive association with your business.
If you think you want to take the plunge to start your own business, contact us to see how we can help you in your first year in business: 01273 739592