Here is the best practice guide for your limited company
The key areas all limited companies need to follow to ensure compliance with Companies House, HMRC and EU Regulations
Registering your business with Companies House is an exciting step for entrepreneurs. The idea you’ve cooked up in your head is now a legally recognised entity!
But what is a limited company, and what are your ongoing responsibilities after you’ve set up?
What is a limited company?
A limited company is one which is legally separate from the people who run it and has separate finances from your personal ones. This enables you, the business owner, to keep any profits it makes after paying taxes.
To register with Companies House you need:
- A suitable name
- A company address
- At least one director
- At least one shareholder
- An SIC code which identifies what your business does
After forming a limited company there are a number of areas which the company director should follow that will ensure compliance (vital if you don’t want to get closed down or fined large sums of money).
Register with HMRC
Once your company is formed, Companies House will provide you with a Unique Tax Reference (UTR) which you'll need to use to register for corporation tax with HMRC, operate PAYE when you start to employ people, and charge VAT.
If your company is trading, you legally need to keep company accounts separate from personal ones. Open a business bank account to manage your finances. Your bank can also help with loans, international trading and protection from fraud.
This came into effect on 25 May 2018 and sets new standards for protection of consumer data. Falling foul of the regulations can have serious penalties including €20 or 4% of global annual revenue. Formations agent Smarta offer support post incorporation.
All limited companies now have to file a confirmation statement whether trading or dormant every 12 months. This verifies that important information about your company registered at Companies House is accurate and up to date including office address, information about directors, business activities, shareholder details and more. If you have no changes to report, you just have to ‘check and confirm’ and submit the statement.
Get protected by taking out a range of business insurance policies. You’re legally obliged to have Employers’ Liability Insurance if you have even one member of staff, but you should also think about public liability, property cover, cyber and data risks, and business interruption.
Managing and growing your business
Now you’ve got all that pesky red tape out of the way, you can concentrate on realising your grand ambitions.
Having an active web presence is essential and how most consumers will first discover you and learn about your business. To kick things off you’ll need to…
- Register a domain name – to do this you use a web hosting service. Your domain name should be short, impactful and relevant to your business. Once you’ve checked whether your domain name is available and decided on an extension, you can pay for it and link it to your…
- Website – it’s worth investing some time and resources in creating a decent website. It’s basically the shop front for your business so, unless you have the skills to do it yourself, use a website builder or pay a professional. As well as being a source of information, your website could be an e-commerce platform and could host…
- Blogs – content is king and if you want to make sure the online conversation includes your business then you better create the content yourself. Write about topics your customers would be searching for online and have good search engine optimisation (SEO) in place to ensure it ranks on Google. You should also promote it on…
- Social media – be active on as many relevant platforms as resources will allow. Engage with customers and keep them up to date with exciting developments
Business cards and flyers
But don’t forget to also promote your business via real world channels.
Getting out on the street with flyers is still an effective way of drumming up interest locally. As there’s nothing to click, the flyer should give them a reason to engage with it. This could be special offers or discounts.
And don’t dismiss the business card. It’s one of the best ways to take advantage of opportunities when you’re out and about. Whether you’re in the pub, at a networking event, or at the airport, giving a new contact a physical reminder of who you are and how they can get in touch with you will increase the chances of a future interaction.
Join professional networking groups
One of the best ways to meet potential partners or collaborators (and to utilise those business cards), networking events take place in cities up and down the UK. Some of them are even specialist ones where you can meet like-minded entrepreneurs. Just remember to be yourself!