Starting a new business, guidance please

Beatle_Ray · 3 January 2018 at 11:54AM

Hello,

Need some help please, I am currently employed but have been told in confidence by the MD that the firm is going to close in the next couple of months and the customers I work on I can continue to do so on my own if I want to, this will mean I will need to start a Ltd company and will have to register for VAT, I expect my turnover to be approx. £200,000+ in the first year, can I do this whilst still employed, I will be working from home and is there a website that I can go to where I can start proceedings and register the company, any help and guidance that anyone can offer I will be grateful for, as I say I expect the business to start end of Jan or end of Feb, it all depends on our clients paying the existing business and the due process of shutting it down, I will be made redundant and will be using a large put of my redundancy to start the business with cash flow
Thanks in advance

fishybusiness · 3 January 2018 at 5:10PM

For that level of turnover I would recommend you go out and find a good accountant before you commence trading.

Put everything in order, T&C's, invoicing, bank account, insurances, maybe a bit of tax planning etc so you more or less hit the ground running.

Try companiesmadesimple.com for creating your ltd.

trailingspouse · 3 January 2018 at 5:56PM

Even though this appears to be a ready made business, you still need to do a business plan and make sure you crunch all the numbers.

The big question I would be asking myself is - if the firm is closing, why are they closing, and why do I think I can make a turnover of £200,000 in year 1.

Pennywise · 3 January 2018 at 8:15PM

First question for an accountant. Do it need to be a limited company? Second question, does it need to be VAT registered? Make no assumptions and properly research your options in both these areas.

soolin · 4 January 2018 at 9:43AM

As above, get proper advice as this is not something you should attempt to muddle through with no idea where to start. If this goes wrong you could stand to lose money, so get it right from the start even if that means paying out some real money to do so.

I am also concerned at the statement in your OP " it all depends on our clients paying the existing business ", does this indicate that you are to be palmed off with clients who have a history of not paying, or paying late?

martindow · 4 January 2018 at 1:25PM

I don't think you can assume that all of the clients will transfer to you - some may go elsewhere in the next few weeks if they get wind that the company is in trouble.

Assuming you do get the clients will some of them have been promised work for which the company has already received money? You don't want to start off with clients who expect you to do work for them and don't expect to pay you.

motorguy · 4 January 2018 at 1:27PM

Pennywise wrote: »

First question for an accountant. Do it need to be a limited company? Second question, does it need to be VAT registered? Make no assumptions and properly research your options in both these areas.

Also, depending on the type of work, some clients will only engage with a limited company (or an umbrella company) so it would be worthwhile understanding that relationship too

motorguy · 4 January 2018 at 1:28PM

martindow wrote: »

I don't think you can assume that all of the clients will transfer to you - some may go elsewhere in the next few weeks if they get wind that the company is in trouble.

Assuming you do get the clients will some of them have been promised work for which the company has already received money? You don't want to start off with clients who expect you to do work for them and don't expect to pay you.

+1

I'd be aiming for 50% and see how the numbers look.

A lot of companies may not wish to deal with a one man band outfit.

Percy1983 · 10 January 2018 at 1:47AM

Why not just take over the current business as a going concern?

As above you need to get proper advice as this doesn't seem to be a simple situation.

Beatle_Ray · 10 January 2018 at 4:33PM

Hi Percey 1983,
Thanks for the reply but that would take a lot of money as an investment and the main clients are going elsewhere so not really an option

Credit-Crunched · 10 January 2018 at 7:39PM

Beatle_Ray wrote: »

Hi Percey 1983,
Thanks for the reply but that would take a lot of money as an investment and the main clients are going elsewhere so not really an option

What sector are you working in, what client base do you have, do you have any experience of running a company?

£200k 1st year turn over is significant for a one man band.

Starting a new business, guidance please

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