difficulty of starting a business?

[rainbow]

what i would like to know, is who out of the members of this forum are self employed and, how they cope? and the stages of success and pitfall of their chosen venture...

i am trying to gather as much adivce and info as possible as in the next year or so i plan to start something for myself

thanks

[ctid]

Both of my parents started their own businesses in the last year or so, and one major tip is, get an accountant. They are worth their weight in gold when it comes to tax and vat returns.

Another thing is, make sure you have enough money saved up to live on for the first 8 - 10 months of your business, as you most likely won't be making enough to live on in those first months.

[rainbow]

noted, i wont be doing anyhing in the short term bar saving

[Matt1eD]

I've just incorporated and basically get the business link guides, they're very useful and go and as ctid says, go and see an accountant asap... most offer a free consultation as your first.

Companies House, Business Link, DTI, Inland Revenue etc. have good info. on their sites.

[DR]

- Make sure you register as self employed both NI and Tax
- If you are going to become an LTD - make sure you speak to an accountant - 1 hour of their time minimum.
- Make sure you plan out your finances and how you will be paid (or what you will live off)

[autopilot]

I was sick of being in low paid I.T. and social work jobs, so I bought a franchisee for £15 which i borrowed.

I know earn £40 plus a year for not much work, mainly playing games, listening to MP3's and drinking tea.

It's always worth looking into franchisess, they are good options for some people. Was for me anyway, but there are a lot of scams around.

[rainbow]

really is ther any franchises around that areof interest to some1 in i.t, i mean i dont fancy opening a osta coffe ty for the advice so far

[IBM]

It's hard work....and stressful. It's also fun, a challange, and a great experience. And even if you fail, it'll looks good on your CV should you seek gainful employment once again (worded correctly).

There are some very good business forums out there too, ukbusinessforums.co.uk have a pretty diverse collection of people happy to help....and it's a good place to look for business services too.

[Zak33]

it makes you realise how special being on PAYE was.....but it's good for the soul, and pushes you hard.

Accountant is a must, but YOU must keep trakcs of everything...ever. If you sell something perosnal on ebay, when youpay the money in, write it on your bank statement, so you rememer in 5 years time what it was!

You'll probabyl be best to have a basic level of third party insurance in case anything you ever do wrong, is partly covered or at least you have legal aid on defending it.

When you do a tax return, you'll be expected to pay the last 6 months of your tax and the NEXT six months of your tax, which means they take an average of what you did earn, and presume it will go up a tad, and they take that too....then you work throuh the period you've paid for, and then into a period you've not paid for (totalling a year) and then you're expcet to pay the last 6 months and the next 6 months again....this carries on and is great if your business makes more and more dough, as you are always in credit, as you've made more than they guessed.

This is fine until the one year when you're business struggles and then youll be expected to pay a load of tax on dough you've not even made and are not liely to make and you wont get that excess back for another year.

That's how larger estate agents and other similar businesses get into cack....the year it goes bad after several boom years is the year they aint got dough and need even more than normal!

Open a seperate bank account for work and STICK WITH IT, dont use your personal account (I have and did and it's a nightmare for all sorts of reasons, ebay being one)

Keep invoices for EVERYTHING ....gas, electric, phone, mobile etc etc...as if you woprk from home too, you can offset a percentage of all those bills against your income, as other people go to work and use their heat, water, phone etc and you don't. Accountant will advise of the percetages.

Keep milage records every day, as using your own car for work saves you the tax part of 40p per mile for the first 10,000 miles and 25p per mile afterwards...dont forget, thats not the actual 40p, jst the tax you'd have paid on it. Still, it's nice.

Keep all your bank statements and end of year tax forms for building society, shares, bank accounts etc and DONT LOSE THEM.....ask the banks for year end tax paid certificates.

That should keep you going

[Steve B]

i was talking to my boss, whos a franchisee about starting my own business. He said be warned, most new businesses dont make money in their first 3 years of opening, let alone one year :\

[Matt1eD]

Keep all your bank statements and end of year tax forms for building society, shares, bank accounts etc and DONT LOSE THEM.....ask the banks for year end tax paid certificates.

That should keep you going

If you form a limited company you have to have a business account by law. These are charged enourmous rates for just being open however most banks offer you the first year or so without fees (NatWest if you're a personal customer is 18 months).

But do this early; I've been using a personal account for it for a month whilst getting the other sorted and it is a nightmare getting everything to balance properly.

Other advice: make sure you're organised in everything you do, have all your documents sorted properly in folders and I back paper up by scanning it in... then do make sure you backup your computer. I carry all my paper files on my HDD aswell so that saves me carrying paper around to clients.

[Steve B]

Back-up is a good plan. Get a filing cabinet too the more oraganised you are in the beginning, the easier it is. Saying that, its not at all easy.

[Bluecube]

Something that's been missed out - make sure you've got a good idea and that you know that you'll be able to make money from it. There's no point setting off down a long road on blind faith alone...

[chicken]

Also don't expect to get anything on credit for the first few years. Having seen many people buying things on payment plans, the moment anyone said they were self employed the odds of it getting accepted dropped to about 10%, if they then said they were only a couple of years into it I'd lose all hope of it going through at all.

[Matt1eD]

Something that's been missed out - make sure you've got a good idea and that you know that you'll be able to make money from it. There's no point setting off down a long road on blind faith alone...

Quite. Take the time to write a business plan (there are plenty of templates available), what makes you unique etc.? Get others to check it and give you ideas/input/advice.

If you're marketing any products to get a good name and reputation with a consistent brand identity... you don't want your business cards done in arial and your letters done in andy!!! Do some social networking... don't be afraid to let people know about you and you'll be surprised to find how much free advertising is available through people.

[Proplus]

The 1st golden rule of running your own business is - know your trade and the market you are aiming at. If you don't have any clue on these, then no matter how good your accountant is or how good the bank your business account is with, or even how good your business plan is, you are not going to be able to make it.

The first thing you will need to do is research, without this you will not even know the foundations of starting your own business, things like how much is it going to cost to start up. There's no point thinking that you've got 30k sitting in your bank and think its enough, when in actual fact it'll cost 150k, and the bank is refusing to loan you the extra 120k.