Here are some important action points to get cracking with as soon as possible in terms of both the functionality and the legality of your online business.

  • Decide what type of business you’re going to be: Are you going to be a sole trader, a partnership, or are you going to become a statutory business entity?

  • Register with HMRC: You’re required to register your business with Her Majesty’s Revenue and Customs, and you’ll probably have to register for VAT as well.

  • Choose an accounting method: You can either use cash-basis or accrual-basis accounting.

  • Choose an accounting period: The calendar year is simple, but you can also choose a fiscal year.

  • Record your revenue: Write down the amount you receive, the form of payment, the date, the name of the client, and the goods or services you provided in exchange for the payment.

  • Keep track of expenses: Write down the date the expense occurred, the name of the person or company that received payment, and the type of expense incurred.

  • Be aware of Health and Safety restrictions: As soon as you set up and register your online business, you must create a safe and risk free environment for your employees (even if the only employee is you!).

  • Research your trade name: Do a search on the Internet followed by a search of Companies House.