Turning an idea into a registered business is mostly a series of practical steps. This checklist walks you through them, from choosing a structure to opening a business bank account.
Published July 2026 · Updated July 2026
Before any paperwork, sketch the basics: what you will sell, roughly what it costs you, and what you will charge. You do not need a full business plan, but knowing your likely margin and break-even point tells you whether the idea stands up.
Most people start as a sole trader (simple, you and the business are the same in law) or a limited company (separate legal entity, limited liability, more admin). Your choice affects your tax, your paperwork and your personal risk, so it is worth getting right early.
A sole trader registers for Self Assessment with HMRC. A limited company is set up at Companies House and then registers for Corporation Tax. If your turnover will pass £90,000, you will also need to register for VAT.
Keep business and personal money apart from the first transaction. A dedicated account makes bookkeeping, tax and bank reconciliation vastly easier, and for a limited company it is essential because the company's money is legally separate.
Decide how you will record income and expenses before the money starts moving. Digital records are quickly becoming mandatory under Making Tax Digital, so starting digital saves a painful switch later.
Quick sense-check before you commit:
Sole traders can trade under their own name or a business name without registering it separately (with some restrictions). A limited company name is registered at Companies House and must be unique.
Becoming a sole trader is free to register. Incorporating a company costs a small Companies House fee. Your real costs are usually equipment, software and any stock.
Only once your taxable turnover passes £90,000 in a rolling 12 months, though you can register voluntarily earlier if it suits your customers or costs.
This guide is general information for UK small business owners, not accounting, tax or legal advice. Rules, rates and thresholds reflect 2026/27 and change over time; always check the linked official source or a qualified adviser for your situation.