Start ups

Start ups

Accounting for start ups doesn’t need to be stressful or complicated!

As a start up is it too early to appoint an accountant?

Absolutely not, although we would say that wouldn’t we!

In all seriousness, you really need to consider a lot when you’re a start up. You’ve got this great business idea or product and you want to tell the world all about it.

It’s crucial in the early stages that you make the right decisions in relation to the structure of your business, accountancy and legal matters.

This is why it is arguably the most important time to appoint an accountant, so that your accounting in startups is correct!

So what do you need to consider?

What structure should start ups adopt?

There are many different structures your business can adopt however, the three main ones are to operate as a sole trader, a partnership or a limited company. 

Sole Trader

If it is just you and your start up, you may well consider operating as a sole trader. As a sole trade you and the business will be the same entity. Therefore, the assets and debts of the business belong to you personally.

You will need to register with HMRC for self-assessment and you will need to keep accounting records and prepare and file a personal tax return each tax year. 


Maybe you are planning on going into business with someone else or multiple people. If so, a partnership may suit you. Like with being a sole trader, the business and yourself will be classed as the same entity, there is no distinction.

However, depending on how much of the partnership you own, will depend how much of the assets and debts of the business belong to you personally.

It is always advisable to draw up a partnership agreement so that the details of the percentages of ownership are known and legally biding from the beginning of the start up.

You will then be required to prepare and file individual personal tax returns and also a partnership tax return each tax year. 

Limited Company

A Limited company is a separate entity from you as an individual however, there is a lot more compliance that you need to consider. It is worth nothing that the assets and debts belong to the company not the individual.


A limited company will be registered on Companies House which is a public record. The company will be required to file annual accounts and an annual Confirmation Statement, as well as a corporation tax return.

You will also need to consider shareholdings, directorships and persons with significant control. Again, it is always advisable to draw up a shareholder’s agreement if there is more than one shareholder in a company.

Other things to consider with your start up

With all of the above structures you will need to consider the following:

Do you need to be VAT registered?

Are you looking to employ people and need to set up a payroll and pension scheme?

Are you in the construction industry and need to register for CIS?

What accounting system are you going to use to keep your accounting records? Will it be compliant?

Have you considered your personal tax implications based on your business’ structure?

Accounting for startups doesn’t need to be stressful, but there is a lot to consider!

Finding accounting firms for startups can be challenging however, we have the expertise to make sure you’re heading in the right direction!

Our accounting services for startups

Registering you for self assessment.

Setting up a partnership or incorporating a limited company.

Registering your business for VAT, PAYE and CIS (if required).

Implementing an accounting system and providing training to you and your staff.

Keeping you compliant by preparing accounts, tax returns, VAT returns, CIS returns and running monthly payrolls.

Advising you on the correct structure and shareholdings. 

Keeping you compliant as a limited company at Companies House.

Giving you tax advice and guiding you along your start up journey.

Providing bookkeeping for startups

We aim to support you every step of the way as your embark on your new start up!