Choosing the legal structure 

The options for new businesses are typically a sole trader, partnership or a Limited company. 

Sole trader businesses are owner managed businesses with only one owner who receives all the business profits. 

Partnership businesses are owner managed businesses with two or more owners who receive the business profits in an agreed profit sharing arrangement.

Limited companies can be set up by one or more people all who hold shares in the business. The number of shares held personally determines the level of dividends each shareholder can receive and the percentage of ownership of the company. 

You must keep records of all your income and expenditure each year along with copies of you bank statements, invoices, receipts and wage calculations. These form the basis of your annual accounts and self assessment return.

Preparing a business plan 

It is essential to have a realistic, working business plan when you start up in business this shows that you are committed to the business. 

It must demonstrate your vision for the business, becoming a living document that is updated and helps the business to keep on track as the business grows.

 A Business Plan needs to include:

  1. An executive summary.
  2. The business proposition.
  3. Market and sales strategy.
  4. Management team and personnel.
  5. Operation of the business.
  6. Financial forecasts for three years.

It will help you to spot the pitfalls before they happen.

Structure the business finance efficiently.

Focus you on developing your business.

The budget setting will become the barometer to measure you success. 

Business Plans are very useful for yourself and also for your bank and potential investors.

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