As we move into 2025, the landscape of business leadership is undergoing significant traStarting a business in the UK can be exciting, but it’s essential to ensure all legal steps are properly followed to avoid future complications. Here’s a beginner-friendly guide outlining the 10 key legal steps you need to take to register your business in the UK.
1. Choose Your Business Structure
The first legal decision involves selecting the appropriate structure: sole trader, partnership, or limited company. Each comes with different tax obligations, liability, and administrative requirements.
2. Decide on a Business Name
Your business name must be unique and adhere to UK naming regulations. Check for name availability using the Companies House register and ensure it doesn’t infringe on existing trademarks.
3. Register with HMRC or Companies House
Sole traders must register with HMRC for self-assessment tax. Limited companies need to register with Companies House and obtain a company registration number.
4. Get a Business Address
You’ll need a UK address for official correspondence. For limited companies, this becomes your registered office address and must be publicly listed.
5. Apply for Necessary Licences and Permits
Depending on your industry (e.g., food, construction, childcare), you may need specific licences or permits to operate legally. Use the UK government’s licence finder tool to identify your requirements.
6. Open a Business Bank Account
Though not legally required for sole traders, a separate business account helps maintain clear financial records. Limited companies must have one to separate business finances from personal.
7. Understand Data Protection Rules (GDPR)
If you handle customer data, you must comply with the UK GDPR and may need to register with the Information Commissioner’s Office (ICO).
8. Register for VAT (if applicable)
If your business turnover exceeds the VAT threshold (£90,000 as of 2025), you must register for VAT with HMRC. You may also register voluntarily to reclaim VAT on purchases.
9. Get Business Insurance
Certain insurances, like employers’ liability insurance, are legally required if you hire staff. Other insurances like public liability or professional indemnity are recommended.
10. Keep Proper Records
You must maintain financial records, invoices, and receipts. Limited companies are required to file annual accounts and confirmation statements with Companies House.
Following these steps will ensure your business is legally compliant and properly registered. Taking the time to get it right from the beginning sets a solid foundation for growth and success in the UK business environment.