Planning a new business? Calculate your startup costs — from company registration to premises, equipment, working capital, and marketing. Get a realistic view of how much you need to launch your business.
Frequently Asked Questions
How much does it cost to start a business in the UK?
A home-based service business can start for under £1,000. A retail or office-based business typically requires £5,000-£50,000. Manufacturing or premises-heavy businesses may need £50,000+.
How much does it cost to register a limited company?
Registering a limited company via Companies House online costs £50 (same-day). Postal registration is £71. Third-party formation agents may charge £20-£100 for assisted registration.
Do I need a separate bank account for my business?
Legally, sole traders do not need a separate account, but it is highly recommended for clean accounting. Limited companies must have a separate business bank account.
What insurance does a new UK business need?
Most businesses need: Employers' Liability (legally required if you have employees), Public Liability, Professional Indemnity (if providing advice), and contents/equipment insurance.
What are the cheapest business types to set up in the UK?
Sole trader is the cheapest (free registration, minimal admin). Limited company costs £50 to register but has annual filing requirements. Partnerships are free but all partners share unlimited liability.
Can I claim startup costs as a business expense?
Pre-trading costs incurred for business purposes can be claimed as expenses, backdated to when you commenced trading (usually up to 7 years before trading begins for capital expenditure, earlier for revenue costs).
What is a Start Up Loan?
Start Up Loans are government-backed personal loans of £500-£25,000 at 6% fixed interest for new UK businesses. They include free mentoring and a business plan template.
What grants are available for UK startups?
UK startup grants include: Innovate UK grants, local enterprise partnership grants, sector-specific grants (creative, agri-tech, clean tech), and local council grants. Check Business Finance Support Finder on GOV.UK.
How long before a new business breaks even?
Most small businesses take 2-3 years to break even. High-margin service businesses may break even in months. Businesses requiring significant capital investment may take 5+ years.
What records must I keep from day one?
Keep all invoices, receipts, bank statements, contracts, and employment records from day one. HMRC can audit records from the start of trading.
Do I need to register for VAT immediately?
You only need to register for VAT when your taxable turnover exceeds £90,000 in 12 months. You may voluntarily register below this threshold if beneficial (e.g., to reclaim input VAT or appear larger to clients).
What is the main difference between sole trader and limited company?
Sole traders have unlimited personal liability — business debts are personal debts. Limited company shareholders' liability is limited to their shares. A company is a separate legal entity from its owners.