Starting your own company is an exhilarating feeling, if not a little daunting at the same time. That’s why it’s good to be prepared and to know exactly what you need when you’re registering a company for the first time.
By doing so, you give your business venture the strong foundations it needs to thrive. Registering a company is indeed a pivotal step which moves from an idea to a hobby and then to a legal entity. Here are five essentials that every first-time business owner should know about the registration process.
- Choose between a Limited Company or a Sole Trader
First and foremost, you must choose between a Limited Company or Sole Trader. Before filing any papers, the desired structure is something you must decide upon.
A sole trader is easier and faster to set up, but you are personally liable for any business debts. This will put your own personal assets at risk.
Registering as a limited company acts as a separate legal entity. This separates your personal finances from the business and, as such, offers limited liability protection. It’s often viewed as more credible for clients and banks, which might be the preferred choice when registering a company.
- Your registered office address becomes public record
Once you register a company, you’ll want to provide a registered office address. This address is published on the public Companies House register.
If you’re working from home, this means your home address will be publicly available. Many entrepreneurs use a professional registered office address service
When registering a limited company, you must provide a “registered office address.”
This address is published on the public Companies House register.
If you work from home, this means your home address will be publicly available. Many entrepreneurs use a professional registered office address service to maintain privacy and add a more professional image.
- You must choose a unique name and check trademarks
It’s important that you’ve chosen a unique name and that the name is not too similar to any existing companies.
You should avoid sensitive words, as certain words like ‘Royal’ or ‘Association’ require permission to be used.
It’s also good to check trademarks to ensure they’re free to use. You should check both Companies House and Intellectual Property Office to avoid infringing on any existing trademarks in place. You’ll also find it beneficial to secure corresponding website domains and social media handles early, too.
- Understand ongoing compliance duties
Ongoing compliance duties are not something every newcomer to the business world will be aware of. That’s why it’s good to not only register but also to file annually your confirmation statement to keep your company details up to date.
You’ve also got to make sure your accounts are up to date, and any Corporation Tax is paid. Record keeping is mandatory, even if the company is dormant.
- You need a separate business bank account
Finally, make sure you’re getting yourself a separate business bank account so you can differentiate it from your personal banking.
These tips will help you navigate registering a company for the first time.
