10 steps to start a business in the UK

Thinking about starting a business in the UK? You’re not alone. Every year, hundreds of thousands of new businesses are ‘born’ – whether it’s to escape the nine to five, pursue a passion or simply start something new. But as exciting as it is, starting a business can also feel overwhelming. There’s no shortage of information available online, and it’s not always clear how to begin.

This guide is here to simplify things. Whether you’re planning on becoming a sole trader, launching a limited company, or are just exploring your options, these are 10 clear, manageable steps you can follow. Along the way, we’ll also highlight some tools and services that can support you, including how Zempler Bank can help with business banking and forming your company.

1. Validate your business idea

Before anything else, ask yourself: is there real demand for what I’m offering?

You might have a brilliant idea, but if no one needs it or is willing to pay for it, it’s going to be a tough road. Start by researching your potential customers. Talk to them about how they could be better served, validate that your business idea is wanted, and use the feedback to refine your offering. You could meet them face to face or use online forums and social media communities to gather the initial feedback that will help you prove (and improve) your concept.

The goal here isn’t perfection. It’s to build evidence and confidence that what you’re doing will meet a real need or solve a real problem.

2. Choose the right business structure

Your structure determines how your business operates legally, how your profits are taxed and the level of personal liability you take on. Common business structures in the UK include:

• Sole trader: a simple structure where you’re the sole owner. You keep all profits but are personally responsible for all debts and liabilities.
• Limited company: a separate legal entity from its owners. Offers limited personal liability, potential tax benefits and is ideal for scaling or taking on investment. Requires more administration.
• Partnership: a shared business structure between two or more people. Profits and responsibilities are divided among partners who are personally liable for debts. 
• Limited liability partnership (LLP): a hybrid structure that combines the flexibility of a partnership with the limited liability of a company.

Many new businesses start as sole traders due to the simplicity, but a limited company might be a better option if you plan to grow, bring in investors or need extra legal protection.

Learn more about the types of business ownership.

3. Create a business plan

A business plan is more than just another thing on your to-do list. It’s a powerful tool for making informed decisions and a critical requirement if you’re seeking funding. At its core, a strong business plan should clearly outline: 

• What your business does and who it serves
• Your value proposition – why customers will choose you over your competitors
• A market analysis and understanding of the competitive landscape
• Your revenue streams and pricing strategy
• The marketing and sales approach you’ll use
• Your financial projections – grounded in realistic expectations

It doesn’t need to be overly elaborate. What matters most is that it’s clear, practical and built on a solid foundation.

4. Register your business

It’s time to make your business official. 

• Sole trader? Register with HMRC for self-assessment unless your annual earnings are below £1,000
• Limited company? Register with Companies House. You’ll need to provide key information including your company name, address, directors and share structure 

Key legal info: If you’re launching a limited company, don’t forget to register for Corporation Tax within three months of kicking off your business operations. Visit GOV.UK for detailed guidance.

In autumn 2025 Companies House will bring in new ID verification requirements for directors and individuals with significant control (PSCs) as part of wider reform to enhance corporate transparency. 

Some business banks, like Zempler, offer company formation services to simplify the registration process when you open an account.

Ready to go limited? Zempler makes it simple

Thinking ahead and going for a limited company structure instead of a sole trader? Zempler Bank makes it easy to form a limited company and apply for a business account in one go. No juggling different platforms, no chasing paperwork – just a quick, seamless setup built for people who want to focus on growing their business rather than navigating red tape.

Learn more about our Formations service.

5. Open a business bank account

One of the most common mistakes new founders make is mixing their personal and business finances. This can end up being very confusing with messy bookkeeping and major headaches when tax season arrives.

Opening a dedicated business bank account offers several key benefits:

• Simplifies expense tracking
• Streamlines accounting processes
• Provides better cash flow visibility
• Helps you stay compliant with Making Tax Digital.

For limited companies, having a separate business account is mandatory. While it’s not required for sole traders, it’s highly recommended to help keep finances organised and avoid hassle and issues down the line.

Apply for a business bank account in minutes with Zempler Bank. Stay organised with real-time notifications, effortless expense tracking, and detailed cash flow insights, all tailored to help you manage your finances with ease.

Check out Zempler’s business bank accounts.

6. Know your legal and tax obligations

It may not be the most thrilling part of running a business but staying on top of your legal and tax responsibilities is absolutely essential. Depending on your business type and individual circumstance, here’s what you might need to do:

• Register for taxes: this may include Self-Assessment, Corporation Tax or VAT
• Register for VAT: if your taxable turnover goes over £90,000 a year, registering for VAT is mandatory. You can also register voluntarily if your turnover is lower
• Maintain accurate records: proper record-keeping is crucial for HMRC compliance
• Apply for necessary licenses: for example, you may need licenses for food, alcohol or premises depending on what your business does
• Data protection compliance: if you process personal data, you’ll need to register with the ICO to comply with data protection laws
• Secure the right insurance: you may need public liability, professional indemnity or other industry-specific insurance to protect your business
• Hiring staff: if you plan to hire staff, you’ll also need to set up PAYE and understand your responsibilities as an employer

Staying informed and proactive about the obligations relevant to you will keep your business running smoothly and legally compliant.

For tailored advice, consult a financial or legal advisor.

7. Prepare your tools and systems

Before welcoming your first customer, make sure the operational aspects of your business are fully set up and ready to go. Here are a few things to consider: 

• Accounting software: so you can keep track of your income and expenses easily 
• Project management tools: platforms like Trello or Asana can help keep you organised and managing all your tasks efficiently 
• Business email and domain: establish a professional presence with a custom email address and domain name 
• Website: even a simple one-page site can make a big impact and give your business credibility
• Essential equipment and inventory: make sure you have the tools, technology and supplies you need to deliver your product or service effectively 

Some business bank accounts also offer built-in tools to help you manage your finances right from day one. With the right systems in place, you'll be ready to hit the ground running.

A taste of the tool a Zempler Bank business account offers: 

• Pots: organise your finances effortlessly 
• Invoice generator: create and send professional invoices in seconds 
• Automated receipt capture: Keep track of expenses with ease 
• Spending insights: get a clear overview of your financial habits
• Making Tax Digital tool: simplify tax compliance with digital efficiency 
• Integrated accounting: sync your account seamlessly with accounting software 
• Digital receipt capture: digitise and store all your receipts as you go

8. Get the right business insurance

Insurance isn’t just for big businesses – it’s essential for businesses of all sizes, even if you’re a one-person operation. Without proper coverage, a single mishap could put everything at risk.

Here are some of the most common types of business insurance in the UK:

• Public liability insurance: protects your business against claims if someone is injured or their property is damaged as a result of your operations
• Professional indemnity insurance: covers you in case of errors, omissions or mistakes in the services you provide
• Employers’ liability insurance: a legal requirement if you hire employees, this covers claims from workplace injuries and illnesses
• Business contents insurance: safeguards your essential equipment and stock against theft, damage and loss.

To find the best policy, you can compare options through brokers or online platforms like Superscript.

9. Start marketing your business

You’re all set up – now it’s time to attract customers. Start small. Effective marketing doesn’t always need a big budget. Here are some proven strategies to get you going:

• If you have a physical presence, claim your Google Business Profile to boost visibility in local searches
• Build a simple website with clear, compelling calls to action
• Establish your presence on Facebook, Instagram or LinkedIn – or all three depending on the platforms your audience prefers
• Engage with your community by joining local networking groups or online communities
• Encourage early customers to provide referrals or share testimonials to build credibility

The more you connect with your audience, the sharper and more impactful your message will become. You don’t need to be everywhere at once though – focus on meeting your audience where they already are.

10. Reflect, adapt and get ready for anything

No business gets everything perfect on the first try. The most successful ones learn, adapt and evolve quickly, turning early missteps into valuable lessons, listening closely to customer feedback and making continuous improvements along the way.

To stay on track, set regular checkpoints to evaluate:

• What’s working well and what isn’t – both commercially and operationally
• Your spending habits and areas where you can cut costs
• Customer feedback and frequently asked questions
• Your goals for the upcoming quarter

Final thoughts: start small, think big

Launching a business demands thoughtful planning. With the right education, tools, support and a clear roadmap, you can turn your idea into reality faster than you might expect.

When you’re ready to begin, you can find official guidance and resources on GOV.UK.  And when it’s time to open a business bank account, Zempler Bank is here to support you along the way.