About to set up your own business? Read this first.

Stepping stones for starting up

The process of setting up a business has much in common with applying for life insurance. It’s a straightforward admin task - but one with serious financial and legal implications. Which if you’re like me can be more than a little disconcerting.

The good news is that the self-employed community is very happy to share experiences. At the start I found this invaluable.

I’m now16 months into my new life, so the good folk at Brave Starts suggested I offer up some pointers of my own.

If the usual caveat about this not constituting financial advice needs flagging. Then I can also guarantee that - like life insurance - once you’re good to go you soon forget the initial uncertainty. Which leaves only the monthly direct debits to jog your memory.

Here we go:

Do I need a business bank account?

I was told that these aren't a legal necessity. Especially for sole traders working from home as consultants and freelancers. Transaction traffic on the account is low and on par with a personal bank account. Plus many expenses are by credit card, with one monthly direct debit.

But do have a separate bank account for this purpose, ditto credit card. I had some spare ones I could use, otherwise I’d have opened a formal business account.

IT: MS365 and tech

It’s well worth paying the monthly subscription for a professional MS365 account. Not least as it offers access to the full Teams package. That’s the easy bit, after that I found it gets confusing as MS have several options. And at the time the brand names for each had changed, adding further to the sense of bafflement.

In the end, I spent £150 on mate’s rate support from an IT pro – all sorted via remote access to my PC. I found the right package and had existing software wiped – so no clashes. I’ve booked an annual IT MOT to keep things purring.

IT: domain name and branding

The same IT supremo set me up with a domain (via 123-Reg). Many names are long gone but with some lateral thinking there’s always scope. Keeping it focused on your own name makes sense if you’re selling your own expertise.

With a domain name you can set up MS Outlook that works like it did when you had a job with an employer. Very reassuring!

Professional indemnity insurance

I was advised to pay no more than £200 per annum – and to limit cover to what I need. Mine came at a reduced rate through a professional membership I hold.

Complexity and costs only rise if your work has implications for commercial risk. Or practical stuff like responsibility for other people or the installation of equipment.


I created my own invoice template. Government websites provide lots of advice on the correct format and legal elements. You’ll need a company name but not a logo as such. As a sole trader, you list your name and a T/A title.

If you’re using a personal bank account, include your surname with your bank account details. I did wonder whether a payment would bounce back because I was a supplier using a personal bank account. But I've not had any issues to date.


I do mine on a spreadsheet. My income/outgoings are few and easy to track but they do mount up. So I try to do them on a monthly basis (ok, quarterly…).


My accountant came recommended. He’s helpful but very busy. If you have a lot of questions, I’d recommend a dedicated time slot rather than relying on email exchanges. You may pay for this but it’s quicker and reassuring. Especially at the start and when submitting your first tax return.

Your return will factor in your financial position before going self employed. So you need to include interest and earnings from savings and other income. Providing information on this can take as long as collating your business accounts.

Professional memberships

If you have any they are well worth keeping. When you’re self employed these online services and learning resources are invaluable. Mining this expertise has definitely got me work - it gives you confidence as much as anything else.

Good luck and happy admin…

That’s pretty much the grand total of my experience.

The MS365, indemnity insurance, and Domain registration (for two years) come in at £12-£16 each a month. Accountancy fees all-in including a lot of advice were c£300 +VAT for set up and first-year tax return.

The only cost which felt exorbitant was some legal advice on a contract. A phone call and follow up email came in at £250 +VAT. But it may well have saved me a lot more – the advice was to say no and walk away.

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