Young Entrepreneur's starting mobile catering business

THAAWT

I have two 16 year olds (17 this year) and are looking to set up a mobile food van. my question is how we can go about them taking card payments without having a business bank account (as they are under 18)
They currently run a small confectionary business from home and are registered with hmrc etc (and currently take bank transfer or cash) but its the payment side of things for a mobile catering van as not everyone carries cash these days

Any advice would be much appreciated

Savvy_Sue

Can you join the business for the purpose of getting a business bank account, or would they not trust you?

Devongardener

Most business accounts have monthly and some transaction fees which have to be factored into profit calculations.  There will also be a charge for taking card payments, through 3rd party provider.   Banks will also do a credit check before opening an account which for 16/17 year olds could be a problem.   

Not wanting to put a dampener on their entrepreneurial ambitions, but they will also need business insurance for their van and public liability as well as a hygiene certificate if they are preparing and selling food.  

I wish them well and hope they can work it out!

SiliconChip

How is the van going to be mobile, neither of them are currently old enough to drive, and even when they are old enough and have passed their tests the cost of business insurance on a van to be driven by one or both of them is going to be astronomical, even if it's possible to find it? In fact, if the van is C1 size it's not legal to drive it until the age of 18.

DullGreyGuy

THAAWT said:

I have two 16 year olds (17 this year) and are looking to set up a mobile food van. my question is how we can go about them taking card payments without having a business bank account (as they are under 18)
They currently run a small confectionary business from home and are registered with hmrc etc (and currently take bank transfer or cash) but its the payment side of things for a mobile catering van as not everyone carries cash these days

Any advice would be much appreciated

I suspect most parents in similar situations would have to be involved in the business, firstly to drive the truck and secondly to enter into certain contracts. 

So option 1 is you get a Zettle or Square or SumUp device that they use to take card payments. You probably can set it up so that payment goes into an account in one of their names or a joint account if they have one. 

Option 2 may solve a few problems and that is to incorporate and operate via an LTD. Its overkill in many sense but as its the company that has the bank account, zettle device, insurances etc it avoids the issues of their ages. 

Marcon

THAAWT said:

I have two 16 year olds (17 this year) and are looking to set up a mobile food van. my question is how we can go about them taking card payments without having a business bank account (as they are under 18)
They currently run a small confectionary business from home and are registered with hmrc etc (and currently take bank transfer or cash) but its the payment side of things for a mobile catering van as not everyone carries cash these days

Any advice would be much appreciated

Good on them! Confectionery is one thing, but a food van is a whole new ball game, particularly in terms of insurances, local authority approval, hygiene requirements etc depending on what they propose to sell. A business bank account is the least of their issues.

A limited company with a parent or two (or other adult) would seem the obvious route to go, at least for now. Minimum age to be a director is 16, so they can both continue to feel they are 'in charge' as far as possible.

One hugely valuable source of help for those aged 16+, and possible funding when they are a little older, is https://www.princes-trust.org.uk/

THAAWT

Savvy_Sue said:

Can you join the business for the purpose of getting a business bank account, or would they not trust you?

Thank you for your reply.  If i'm honest i really have no clue where to start, i'm happy to literally just so they can get a bank account, but other than dropping them off to an event or similar and helping with paperwork then i wouldn't be involved.  Is that ok do you know?

THAAWT

Devongardener said:

Most business accounts have monthly and some transaction fees which have to be factored into profit calculations.  There will also be a charge for taking card payments, through 3rd party provider.   Banks will also do a credit check before opening an account which for 16/17 year olds could be a problem.   

Not wanting to put a dampener on their entrepreneurial ambitions, but they will also need business insurance for their van and public liability as well as a hygiene certificate if they are preparing and selling food.  

I wish them well and hope they can work it out!

Thank you for your reply.

I took out insurance for their current business with the business name, including public liability and they both have hygiene level 2 certificates.

I just don't want the bank to be the hold up for them and not sure how to overcome this

THAAWT

SiliconChip said:

How is the van going to be mobile, neither of them are currently old enough to drive, and even when they are old enough and have passed their tests the cost of business insurance on a van to be driven by one or both of them is going to be astronomical, even if it's possible to find it? In fact, if the van is C1 size it's not legal to drive it until the age of 18.

thank you for your reply.

To be more specific its actually a trailer they are looking at.  I am more than happy to drop them off to events and pick them up again (as i would if they had a job as we are in quite a remote are anyway) so i don't think that would be an issue?

THAAWT

Marcon said:

THAAWT said:

I have two 16 year olds (17 this year) and are looking to set up a mobile food van. my question is how we can go about them taking card payments without having a business bank account (as they are under 18)
They currently run a small confectionary business from home and are registered with hmrc etc (and currently take bank transfer or cash) but its the payment side of things for a mobile catering van as not everyone carries cash these days

Any advice would be much appreciated

Good on them! Confectionery is one thing, but a food van is a whole new ball game, particularly in terms of insurances, local authority approval, hygiene requirements etc depending on what they propose to sell. A business bank account is the least of their issues.

A limited company with a parent or two (or other adult) would seem the obvious route to go, at least for now. Minimum age to be a director is 16, so they can both continue to feel they are 'in charge' as far as possible.

One hugely valuable source of help for those aged 16+, and possible funding when they are a little older, is https://www.princes-trust.org.uk/

Thank you for your reply.  Yes they have hygiene level 2 certificates which is what required for a food van.  They know they'll have a EHO Inspection which they are currently looking into all the necessary checklists they'll need.

Do you happen to know if i put my name in the limited company how if would affect me? It would be literally just so they can get a bank account, but other than dropping them off to an event or similar and helping with paperwork then i wouldn't be involved.

Thank you i will take a look at the princes trust, i have heard good things

THAAWT

DullGreyGuy said:

THAAWT said:

I have two 16 year olds (17 this year) and are looking to set up a mobile food van. my question is how we can go about them taking card payments without having a business bank account (as they are under 18)
They currently run a small confectionary business from home and are registered with hmrc etc (and currently take bank transfer or cash) but its the payment side of things for a mobile catering van as not everyone carries cash these days

Any advice would be much appreciated

I suspect most parents in similar situations would have to be involved in the business, firstly to drive the truck and secondly to enter into certain contracts. 

So option 1 is you get a Zettle or Square or SumUp device that they use to take card payments. You probably can set it up so that payment goes into an account in one of their names or a joint account if they have one. 

Option 2 may solve a few problems and that is to incorporate and operate via an LTD. Its overkill in many sense but as its the company that has the bank account, zettle device, insurances etc it avoids the issues of their ages. 

Thank you for your reply.  Yes, i would be dropping them off to events and then collecting them as I would if they had a job as we are in quite a remote area anyway.

So I have a PP account set up for them (in my name) which is then transferred straight to them.  Could i then set up a Zettle and do the same thing? 

I have no clue when it comes to LTD - whats the difference between that and what they're doing now (a partnership) - do you know how it would affect me if i'm listed on the LTD company?