How to Start a Business in the UK 2026: Complete Step-by-Step Guide

Starting a business in the UK is straightforward when you know the steps. Here is everything you need to do.

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Step 1: Choose Your Structure

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**Sole trader:** Simplest option. Trade in your own name, pay income tax on profits through Self Assessment. Personally liable for business debts.

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**Limited company:** A separate legal entity. Pays Corporation Tax on profits (25% above 250,000 pounds, 19% for smaller profits). Better asset protection but higher administration.

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Step 2: Register

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**Sole trader:** Register for Self Assessment with HMRC by 5 October in your second year of trading.

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**Limited company:** Register with Companies House online. Fee is 12 pounds. You need a UK registered address and at least one director.

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Step 3: Tax Setup

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Register for VAT if taxable turnover will exceed 90,000 pounds per year. Open a dedicated business bank account.

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Step 4: Legal Obligations

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Check whether your sector requires licences or registrations. Food businesses need local authority registration. Financial services need FCA authorisation.

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Step 5: Insurance

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Public liability insurance is essential for most businesses. Employer liability insurance is compulsory if you have staff.

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