Becoming a new business owner for the first time is exciting, but it can feel a little daunting too. To help you get prepared, here’s a list of things you could expect from your first year of running a business.
Setting up a business
Whether you want to start your business as a sole trader or as a limited company, you need to register your business to HMRC to let them know you’ll be paying your tax.
Whichever status you use to start your business is up to you, as there are pros and cons to both.
Writing a business plan
If you haven’t done so already, writing a business plan and budget are important ways to get your ideas on paper and create a real plan for how you can bring your business to life.
Whether you’re offering a service or selling goods, you’ll need to find customers and spread the word about your business. Word of mouth, marketing and PR are all ways to let people know about your business and gain new customers.
Adjusting your pricing
It can feel challenging to set your pricing for the first time. There’s a lot to consider, from covering your expenses to how you value your time and skills. If you don’t get it right the first time, you can always adjust your pricing as you go.
Turning a profit
Turning a profit is a sign that your business is starting to succeed! If you don’t already know, then a profit is when you make more money than you spend on expenses. The step before making a profit is known as ‘breaking even’ – when your business can pay its operating costs without making a loss.
Hiring your first employee
As your business grows, your team may need to grow too. If you haven’t started your business with employees, you may need to hire them in future. There’s a lot to consider when hiring employees, and several steps you need to take to make sure you’re a legal employer.
Finding work-life balance
As you settle into life as your own boss, it can be hard to know when to switch off from work. It’s up to you to figure out a work-life balance that suits you and your business.
Doing your taxes
When you run your own business you’ll need to do your own taxes too. If you’ve chosen to run a limited company, you will have different tax obligations than if you were working as a sole trader. It’s important to understand which taxes you need to pay, and which tax returns you need to submit.
Make sure you register before the deadline, keep the right records, and have everything ready when the time comes. It’s also a good idea to get to know your allowable expenses which can be deducted from your profit on your tax return.
Getting to know to account
Accounting is an important aspect of running your business, especially if you’re setting up a limited company. You need to do your accounting in order to submit tax returns and be compliant with HMRC. But, accounting has a lot of benefits for your business too!
From getting the information you need to work strategically to having useful tools to run your business, doing your accounting with online software can help make the process simple.
With bookkeeping and invoicing in the same place, we have everything you need to help you manage your finances. Our automated reports let you keep track of your business performance, be Making Tax Digital compliant, and prepare for your Self Assessment tax return.