Your Complete Business Startup Checklist: Everything You Need to Do When Starting a Business

You’ve chosen your business structure. Now what?

Starting a business involves more than just hanging out your sign and waiting for customers. Get the fundamentals right now, and you’ll save yourself headaches, money, and potential legal issues down the line.

This is your complete checklist for starting your business properly – from registration to tax planning, with the practical details other guides leave out.

Register Your Business
Calculate Your Startup Costs
Understand Your Industry Legislation
Set Up Your Business Bank Account
Get the Right Business Insurance
Set Up Your Bookkeeping System
Get Your Invoicing Right
Plan for Your Tax Liability
Sort Your Marketing Presence
Choose Your Accountant

The Legal Essentials

1. Register Your Business

How you register depends on your structure (if you’re not sure which to choose, read How to Choose the Right Business Structure].

If you’re a Sole Trader:

Register with HMRC for self-employment
Do this by 5 October following your first tax year of trading
It’s free and takes about 10 minutes online
You’ll get a Unique Taxpayer Reference (UTR) number
From April 2026, also sign up for Making Tax Digital for Income Tax

If you’re in a Partnership:

Register the partnership with HMRC
Each partner needs to register for Self Assessment individually
You’ll nominate a lead partner to submit the partnership return
Create a partnership agreement (I’ll explain why this matters in a moment)

If you’re a Limited Company:

Register with Companies House (£12 online, £40 by post, £50 same-day service)
This automatically registers you for Corporation Tax with HMRC
You’ll need:

Company name (check it’s available first)
Registered office address
At least one director and one shareholder
Details of share structure
Articles of Association (standard template available)

You’ll receive a Certificate of Incorporation with your company number
Register for PAYE if you’re paying yourself or employees
Register for VAT if your turnover will exceed £90,000 (or voluntarily if beneficial)

If you’re a CIC:

Follow the limited company process but include the additional CIC section
Define your community interest and asset lock
Budget for the annual CIC report and £15 fee

Timeline: Most registrations are instant or within 24 hours. Companies House registration is usually within 3-6 hours online.

2. Calculate Your Startup Costs

Before you dive in, work out what this is actually going to cost you. Being realistic about startup costs prevents nasty surprises.

Common startup costs include:

One-off costs:

Registration fees (company registration if applicable)
Website design and hosting
Business insurance (first year)
Initial equipment (laptop, phone, tools, machinery)
Initial stock or materials
Professional fees (accountant, legal advice)
Branding and logo design
Business cards and marketing materials

Ongoing monthly costs:

Premises or rent (office, workshop, storage)
Utilities and internet
Software subscriptions (accounting, design, project management)
Professional memberships
Marketing and advertising
Accountancy fees
Bank fees
Phone contract

Don’t forget:

Buffer for quiet months (3-6 months of personal expenses ideally)
Emergency fund for equipment repairs or unexpected costs
Money for tax (more on this later)

Reality check: Most businesses underestimate their startup costs. Add 20-30% to your initial calculation to be safe.

When I work with new clients, I help them create a realistic first-year budget that includes:

Review expected income and expenses with clients and create at least 2 budgets, a worst case and ideal case scenario.
It surprises people how much in sales they need to start making a profit.
Excel or google sheets is a great place to start, to get an idea of start-up costs as it is easy to do and it’s free.

One client budgeted £5,000 for startup costs but hadn’t factored in professional indemnity insurance at £800 or the fact their accounting software would cost £300/year not the £15/month they’d seen advertised (which was just the basic plan).

3. Understand Your Industry Legislation

Different industries have different rules. Don’t assume that because someone else in your field isn’t doing something, it’s not required – they might just be getting away with it (for now).

Common requirements across industries:

Data Protection (GDPR): If you collect any customer information (emails, names, addresses), you need to:

Understand your responsibilities under GDPR
Have a privacy policy
Store data securely
Know how to handle data requests
Register with ICO if you’re processing sensitive data or large-scale processing (£40-£2,900 annually depending on size)

Health & Safety: If you have employees or a workplace others visit:

Risk assessments
First aid provision
Health and safety policy (if 5+ employees)
Employer’s liability insurance

Industry-specific requirements might include:

Food hygiene certificates (food businesses)
DBS checks (working with vulnerable people)
Professional registrations (healthcare, legal, financial services)
Licenses (alcohol, taxis, street trading, music venues)
Planning permission (change of use for premises)
Building regulations (construction, renovations)
Waste carrier license (if you transport waste)

How to find out what you need:

Check your industry trade body website
Look at your local council’s business pages
Search “[your industry] UK regulations”

Don’t skip this step. Operating without the right licenses or registrations can result in fines, prosecution, and having to shut down.

4. Set Up Your Business Bank Account

You need a separate bank account for your business. This isn’t just good practice – it makes bookkeeping infinitely easier, protects you in tax investigations, and is often required for certain business structures.

Why you need a separate account:

Makes tracking income and expenses simple
Protects your personal money if business has issues
Required for limited companies (legally must be in company name)
Makes your tax return or accounts preparation quicker (and cheaper)
Looks more professional to clients

Choosing a bank:

Free options include:

Starling Bank – app-based, good functionality, instant notifications
Monzo – similar to Starling, good for digital-first businesses
Tide – designed for small businesses, built-in accounting features
NatWest – free for some business types, traditional banking
HSBC – free period, then paid

Paid options often include:

More transactions included
Cash deposit facilities
Dedicated account manager
Overdraft facilities
Integration with accounting software

Consider ethical banking:

Your bank doesn’t just hold your money – it invests it. If you care about where your money goes, look at ethical options.

Tools to check your bank’s ethics:

bank.green – shows you how your bank invests deposits
Look for B Corp certified banks
Check fossil fuel investment policies

Ethical banking options:

Triodos Bank – B Corp certified, only lends to positive projects, transparent about where money goes
Starling Bank – carbon-neutral, more ethical lending policies than traditional banks
Monzo – working towards more sustainable practices, transparent operations

The difference? Traditional banks might use your deposits to invest in fossil fuels, weapons, or industries you wouldn’t personally support. Ethical banks have strict policies about where money goes.

In my business, I use Starling & Tide because these are ranked well on Bank.Green and are also have easy to use apps. When I help clients choose their banking, I consider:

The size of their business and the types of income they receive (cash, card etc)
Having an ethical bank is really important to me but so is usability, that is why it is important to look at each option, luckily there are quite a few ethical banking options.
Using Bank.Green was a great tool as I could check which banks are the most ethical and review which of these suited my needs.

Most of my clients end up with Starling because of how easy the app is to use.

What you’ll need to open an account:

Proof of identity (passport or driving license)
Proof of address
Business registration documents (certificate of incorporation if limited company)
Details of directors/partners/owners

Timeline: Digital banks often approve in minutes. Traditional banks can take 2-4 weeks.

5. Get the Right Business Insurance

Insurance feels like a grudge purchase until you need it. Then it’s priceless.

Common types you might need:

Public Liability Insurance

Covers injury to third parties or damage to their property
Required if you work in client premises or public interacts with your business
Typical cost: £50-£200 per year
Common for: Tradespeople, events, retail, anyone working on-site

Professional Indemnity Insurance

Covers claims of professional negligence or mistakes in advice
Often required by contracts or professional bodies
Typical cost: £200-£1,000+ per year depending on turnover and risk
Common for: Consultants, accountants, designers, coaches, anyone providing advice

Employers’ Liability Insurance

Legally required if you have employees
Covers claims from employees for injury or illness from work
Must have at least £5 million cover (most policies offer £10 million)
Typical cost: £100-£300 per year
Required even if employees are family members

Other insurance to consider:

Buildings insurance – if you own your premises
Contents insurance – for equipment, stock, furniture
Business interruption insurance – covers lost income if you can’t trade
Cyber insurance – increasingly important for digital businesses
Product liability – if you manufacture or sell products
Vehicle insurance – business use often needs commercial policy

How much do you need?

Check contract requirements (clients often specify minimum cover)
Look at professional body recommendations
Consider your actual risk (what’s the worst-case claim?)

Don’t be underinsured to save money. A £50 difference in premium could mean £1 million difference in cover.

6. Set Up Your Bookkeeping System

Good bookkeeping isn’t optional. It’s how you understand your business, make decisions, and avoid horrible surprises at tax time.

What bookkeeping actually means:

Recording every penny that comes in (income)
Recording every penny that goes out (expenses)
Categorising everything correctly
Keeping evidence (receipts, invoices, bank statements)
Reconciling your records with your bank account
Being able to report on what’s happening financially

The software question:

Software makes bookkeeping faster and easier, but it won’t do it for you. You still need to understand what you’re doing.

Software companies love to sell you on “automatic bookkeeping” – connect your bank, and everything magically categorises itself. The reality? It gets it wrong. A lot. If you don’t understand bookkeeping, you won’t spot the mistakes, and you’ll end up with incorrect accounts and potentially wrong tax returns.

Good bookkeeping software should:

Connect to your bank account (but you still review everything)
Create and send invoices
Track expenses and allow receipt uploads
Generate reports (profit and loss, balance sheet)
Handle VAT if you’re registered
Connect with your accountant
Store everything securely

Popular options:

Xero – powerful, great for growing businesses, good accountant support (£12-£30/month)
QuickBooks – comprehensive, good reports (£10-£35/month)
FreeAgent – designed for small businesses and freelancers, good for sole traders (£15-£29/month) free options with NatWest accounts.
Sage – traditional, comprehensive, learning curve, incorporates carbon calculator (various prices)

What about spreadsheets? You can absolutely use spreadsheets, especially at the start. They’re free and flexible. But:

You need to know what you’re doing
They don’t connect to your bank
No automatic invoicing
Easy to make mistakes
Harder to collaborate with accountant
Won’t have up to date reports
Time-consuming as you grow

What I recommend:

I use Xero for my own business because I find the interface easy to use. For my clients, I usually recommend:

I would recommend Xero for most types of businesses
This is because it is easy to use.
The most common mistake I see is with bank reconciliations, this ranges from marking items as paid when they aren’t to adding expenses to the wrong account.
I offer bookkeeping services, work with other bookkeepers and offer support and reviews if you want to do your own bookkeeping.

The most important thing isn’t which software you use – it’s that you use it consistently and understand what you’re recording.

I had a client who used Xero for 18 months but never reconciled their bank. When we came to do their accounts, there were 200+ unreconciled transactions and it took days to sort out. Regular reviews would have meant 10 minutes a week instead of days of catch-up.

Essential bookkeeping habits:

Record everything as it happens – don’t leave it for month-end
Reconcile weekly – check your software matches your bank
Keep all receipts – photos on your phone work fine
Review monthly – check you’re profitable and understand the numbers
Back up regularly – though most cloud software does this automatically

7. Get Your Invoicing Right

Your invoice is both a legal document and a marketing tool. Get it wrong and you might not get paid – or worse, HMRC might not accept it as valid.

What legally must be on your invoice:

For sole traders and partnerships:

Your name (and business name if different)
Your address
Description of goods or services
Amount charged
Date
Unique invoice number

For limited companies, you also need:

Company registration number
Registered office address
VAT number (if VAT registered)

If you’re VAT registered, you also need:

VAT number
VAT breakdown (rate and amount)
Total excluding and including VAT

What else should be on there:

Make your invoice professional and clear:

Client’s name and address
Purchase order number (if they gave you one)
Payment terms (e.g., “Payment due within 7 days”)
How to pay (bank details, payment link)
Your contact details
Thank you message

Common invoicing mistakes:

Missing invoice numbers or duplicating numbers
Wrong VAT calculations
Vague descriptions (“Services rendered” – be specific)
No payment terms (makes it hard to chase late payment)
Missing dates
Not keeping copies

Payment terms matter:

Standard is 30 days, but you can set whatever you want:

“Payment due on receipt” – for immediate payment
“Payment due within 14 days” – faster turnaround
“Payment due within 30 days” – standard for most businesses
“Deposit of 50% required, balance due on completion” – for project work

Include late payment terms: “Late payment fees may apply as per the Late Payment of Commercial Debts Act” – you can charge interest and recovery costs on late B2B payments.

Using software for invoicing:

Most bookkeeping software includes professional invoice templates that:

Include all legal requirements
Auto-number invoices
Track who’s paid and who hasn’t
Send automatic payment reminders
Let clients pay online
Look professional

My own invoices include date, invoice number, payment details, description and payment terms. When I help clients set up their invoicing, I make sure they:

Use accounting software to make invoicing easier and consistent.
Include a good description (On accounting softwares you can set up service templates)
Have clear terms, withhold deliverables and regularly chase to avoid late payers.

One client was losing track of who had paid because they just sent Word document invoices by email. When we set up Xero invoicing, they discovered they had £8,000 in unpaid invoices from the last 6 months they’d completely forgotten to chase.”

8. Plan for Your Tax Liability (The Surprise Nobody Warns You About)

This is where most new business owners get caught out. You’re making money, spending it as you go, and then BAM – tax bill arrives and there’s no money left to pay it.

How much should you save?

Sole traders and partnerships:

Income Tax: 20% on profits £12,571-£50,270, then 40%, then 45% over £125,140
Class 2 National Insurance: £3.45/week (£179.40/year) if profits over £6,725
Class 4 National Insurance: 6% on profits £12,570-£50,270, 2% above that
Rule of thumb: Save 25-35% of your profit for tax

Limited companies:

Corporation Tax: 19% on profits up to £50,000, then marginal rate up to 25% on profits over £250,000
Dividend Tax: 8.75% (basic rate), 33.75% (higher rate), 39.35% (additional rate) on dividends over £500 allowance from 6 April 26 these will rise to 10.75%, 35.75% and 41.75%
Rule of thumb: Company saves 19-25% for Corporation Tax, you save 20-35% of dividends personally

Set up a tax savings account:

Open a separate savings account specifically for tax:

Transfer your tax percentage every time you get paid
Don’t touch it except for tax payments
Treat it as already spent (because it is)
Look for notice accounts with better interest rates

Example: You invoice £3,000. Transfer £750-£900 straight to your tax account. Live on the rest. When tax time comes, the money is there.

I set up a savings account and save 20% of estimated profits each month. When I help clients plan for tax, I recommend:

Set up a business savings account for tax purposes.
Calculate saving percentage based on the tax rate you are paying

Every client I onboard, I recommend they set up a tax savings account. I’ve seen too many people scrambling to pay tax bills, taking loans, or getting into payment plans because they didn’t save as they went.

The Tax Surprise Nobody Warns You About: Payments on Account

Here’s what catches people out:in your first year of trading as a sole trader, you don’t just pay tax on that year’s income. You also pay an advance payment toward next year.

How it works:

Let’s say you’re a sole trader and owe £3,000 in tax for your first year of trading (2024/25).

What you’ll actually pay:

January 2026:

£3,000 (tax for 2024/25)
£1,500 (first payment on account for 2025/26)
Total: £4,500

July 2026:

£1,500 (second payment on account for 2025/26)

January 2027:

Any additional tax for 2025/26 (if you earned more)
Or a refund (if you earned less)
Plus first payment on account for 2026/27

This is brutal if you’re not expecting it. In your first January, you’re paying 1.5 times your annual tax bill.

How to prepare:

Know this is coming
Save for it from day one
In your first year, save extra in the second half to cover the January surprise
If your income drops significantly, tell your accountant – you can reduce payments on account

This is the first thing I explain to new clients because this is often missed. I help them:

To keep bookkeeping up to date, to have an idea of profits as you go along.
Put aside savings towards tax each month into a separate savings account.

I had a client making £60k profit in their first year. They knew they’d owe about £12,000 in tax. What they didn’t know was they’d need £18,000 in January – £12k for year 1 plus £6k payment on account. They’d spent the money on business growth and had to scramble for a loan. Now all my clients know about this before they start.

9. Sort Your Marketing Presence

You can have the best business in the world, but if nobody knows you exist, you won’t get customers.

The basics you need:

Professional email address:

Use your domain name (you@yourbusiness.co.uk)
Not Gmail or Hotmail (looks unprofessional)
Cost: £5-10/month usually

Website: You don’t need anything fancy to start, but you need something:

What you do
Who you help
How to contact you
Social proof (testimonials, case studies)
Basic SEO (so people can find you)

Options:

DIY website builder (Squarespace, Wix, WordPress) – £10-30/month
Hire a designer – £500-£5,000+ depending on complexity
Start with a one-page site and expand later
Consider hosting providers using renewable energy

Social media presence: Choose 1-2 platforms where your clients are:

LinkedIn for B2B and professional services
Instagram for visual businesses and B2C
Facebook for local businesses and community building
TikTok for reaching younger audiences
Twitter/X for thought leadership and real-time engagement

Don’t try to be everywhere – do 1-2 platforms well rather than 5 badly.

Google My Business: If you serve local customers, claim and optimize your Google My Business listing (free):

Shows up in local searches
Lets customers find your hours, location, contact info
Enables reviews
Shows photos of your business

Networking:

Join local business groups
Attend industry events
Connect with complementary businesses for referrals
Online communities in your niche

10. Choose Your Accountant (Before You Need One)

Here’s the truth: you should choose your accountantbefore you start trading, not when your tax return is due.

Why it matters:

A good accountant doesn’t just file your tax return. They:

Help you choose the right business structure
Set up your bookkeeping correctly from day one
Advise on what expenses you can claim
Help you plan for tax so you’re never caught out
Spot opportunities to save money
Keep you compliant with regulations
Answer questions as they come up
Help you make better business decisions

Getting an accountant at the end of the year to “just do my tax return” means you’ve missed 12 months of advice, potentially made expensive mistakes, and are paying them to fix problems instead of prevent them.

What to look for in an accountant:

Qualifications:

Chartered Accountant (ACA, ACCA, AAT) or equivalent
Registered with a professional body
Holds Professional Indemnity Insurance
MTD ready (for Making Tax Digital)

Experience:

Works with businesses your size and industry
Understands your business model
Up to date with current regulations
Proactive, not just reactive

Communication:

Explains things in plain English
Responds to queries promptly
Makes you feel comfortable asking questions
Regular check-ins, not just once a year

Values alignment: If you care about ethics and sustainability, find an accountant who does too:

Actively reducing their own environmental impact
Helps clients build sustainable businesses
Understands B Corp and social enterprise models
Recommends ethical suppliers and banks
Sees business as a force for good, not just profit

Fees:

Clear pricing structure
No hidden charges
Fixed fees where possible
Payment plans if needed
ROI – good accountants save you more than they cost

Red flags:

Pushing aggressive tax avoidance schemes
Poor communication
No qualified staff
Very cheap (often means very basic service)
Not interested in your business, just in filing returns

Green & Moore Accountancy Ltd

We embed environmental decisions into the core of our business and help our clients implement environmental actions.

Why work with me?

We are registered with AAT and have over 20 years of experience. You will always deal with the same person and you will be working with a practice that is monitoring and implementing environmental initiatives.

My approach to working with clients:

We start with a free 30 minute discussion to see what you need and if we are a good fit.
Support is built into your fee so you don’t need to worry about contacting us.
The environment is built into all of our policies and decisions, so you know your values are shared.
Sign up is simple with our online portal which is also used for any documents and e-signing.

I work with businesses who are purpose-led and help them reduce the stress of their numbers.

My fees: Our limited company fees start from £65pm and our sole trader fees start from £25pm (Charges are on a monthly basis over 12 months, in advance of the year end via Direct Debit).

What’s included:

Preparation and submission of accounts and tax returns.
General email queries and support
Additional services available such as Payroll, VAT, Software set up, Tax Advice, Personal tax returns.

Your First Month Checklist

Let’s bring it all together. Here’s what you should have done in your first 4 weeks:

Week 1: ✓ Registered your business structure ✓ Calculated your startup costs ✓ Identified your industry legislation requirements

Week 2: ✓ Opened a business bank account (ethical option considered) ✓ Arranged appropriate business insurance

Week 3: ✓ Set up your bookkeeping system ✓ Created professional invoice templates ✓ Opened a tax savings account and set up automatic transfers

Week 4: ✓ Established your basic marketing presence ✓ Chosen your accountant (hopefully me!)

Plus ongoing: ✓ Recording every transaction ✓ Saving for tax with every payment received ✓ Keeping all receipts and invoices ✓ Reviewing your numbers at least monthly

Common Mistakes I See (And How to Avoid Them)

After helping 100’s of businesses, here are the mistakes I see repeatedly:

Leaving registration until the last minute Register as soon as you start trading, not when your first tax return is due. You might face penalties for late registration.
Mixing business and personal money Even if you’re a sole trader, keep separate accounts. Your future self (and accountant) will thank you.
Not keeping receipts “I definitely spent £500 on equipment” doesn’t work without receipts. Photo them immediately and store them properly.
Ignoring the numbers until tax time.Review your finances monthly. Surprises at year-end are never good surprises.
Choosing the cheapest option for everything:Cheap accountants, cheap insurance, free bookkeeping – you often get what you pay for. Invest properly.
Not saving for tax This is the number one way businesses get into trouble. Save as you go.
Trying to do everything themselves. Your time is valuable. Pay experts for things outside your expertise so you can focus on what you do best.

You Don’t Have to Do This Alone

Starting a business is exciting, terrifying, and overwhelming all at once. The practical stuff – registration, bookkeeping, tax planning – can feel like a distraction from actually building your business.

That’s where I come in.

I help people start their businesses the right way – ethical, sustainable, and set up for success. Not just compliant, butconfident.

Whether you need full support through setup or just someone to check you’re on the right track, I’m here to help.

Ready to Get Started?

Book a free 30-minute discovery call and let’s talk about your business. I’ll help you understand:

What you need to do and in what order
What it’s going to cost (really)
How to avoid the common mistakes
How to build sustainability into your business from day one

No sales pitch, no jargon – just practical advice from someone who wants to see you succeed.

Book Your Free Discovery Call

What Next?

You’ve got your business structure sorted and you know what to do to set up properly (this article).

Next up: building your environmental credentials and making your business genuinely sustainable – not just compliant, but competitive.

Coming soon:

How to Review Your Green Operations (Even When You’re Just Starting Out)
Setting Environmental Goals That Actually Make Business Sense
The B Corp Guide for Small Businesses