The right choice for me?
Starting a new business
‘Being your own boss’ can sometimes seem attractive, but when it comes to tax it also means taking on a lot of responsibility – from record keeping to paying tax, from completing tax returns to tax enquiries. You can pay others to help you here, but you are still responsible for what they do.
From a tax point of view, a business must also be a commercial operation. This means that you must aim to make a profit – and that aim must be realistic. Being able to pay the tax due out of the profits is equally important as paying any other creditor; and should be part of your assessment of whether the business is viable in the long-term.
In the sections below we look at some other considerations. For a review of the other issues see https://www.gov.uk/browse/business/setting-up
Your income will depend on your own efforts and business skills, and perhaps other circumstances that you cannot control. You may therefore have to limit the amount of money you take for yourself from your business, particularly at first.
A small business owner is unlikely to work set hours, and you should be prepared to work longer than the normal working week. In many instances clients or customers will contact you at your home and separating home/work life can challenging.
It may be very difficult to take time off for weekends and holidays, particularly in the early years of your business. There are also the uncertainties of business life such as the lack of regular hours and a set income.