What I learned from setting up my own Limited company in the UK
It’s more complex than you realise.
The UK Government has made it very easy to set up a business, and my colleagues based in PAYMILL Germany headquarters are amazed at how easy it is to form a company. However there are a lot of nuances and ongoing requirements that are immediately obvious.
It may because I was naive 21 year old fresh out of university when I set my business up (a limited company selling crowd-sourced designs), but I was massively unaware of how many ongoing costs and responsibilities I had as the company director.
For example, yearly accounts, even when I had made a loss and turned over no more than £1k, cost over £700 to have an accountant complete.
Further to this, I paid £250 a year for the privilege of having my registered office hosted elsewhere. This is to allow myself the option to not have to make my address & documents available for inspection every day.
And all this is before you take into consideration any VAT registration. I was (un)fortunate enough to never turn over above the threshold, so was excused.
What would I do differently?
My first piece of advice for anyone is to get a good accountant. This was my first mistake.
Having open and honest advice when deciding whether Ltd or not would have helped no end. On top of this, being aware of the associated costs would have helped me to identify what skills I needed to learn first.
It wasn’t all bad
I did pick up many skills and insights along the way. For example when learning the cost of building a website, I looked into shopping cart platforms (e.g. Shopify) and taught myself to build Shopify themes (*plug* I’m a Shopify Expert).
I also learned how to create a social media presence, and the challenges that young brands face when reaching their desired audience.
What the Government needs to provide
Well not necessarily the Government, but when I decided to form my company, there was a real lack of easy to understand resources explaining all the requirements of a Ltd company.
All in all, I invested ~£2500 in my Ltd business and saw no return. Would I do it all again? Absolutely, the lessons I learned were invaluable.