You might have heard that starting a business is easy, the difficult part is maintain it. That is very true however that does not mean that you shouldn’t plan well before starting your business. You should put proper time and effort in trying to start your business in the smoothest way possible. There are many decisions that have to be made. One of the things you have to plan is how much money do you need to start your own limited company.
If you are starting a business in the UK then there are different costs associated with it. Let’s take a look at the costs associated with starting a limited company in the UK.
Registration Charges
It is now easier than ever to register a limited company in the UK. You can do it from the comfort of your own home and all you need is an internet connection. This new process is not only less expensive but also less time consuming than the old one, The registration process has evolved since 2008, when start-up companies had to physically go to Companies House and register their company in person. You can register your own limited company in the UK in the range of £12 tosomewhere around £100. Seed Formations is a great platform through which you can register your limited company in the smoothest way possible.
Investment in Land
If you are planning to have a physical workplace or a warehouse for your limited company then you need to have the right amount of funds to invest in land. You can either get a building on rent or you can straight up purchase the building if you have the funds. You need to have the funds ready before you start the business. However in this era of information technology, it is more viable to start a business that can be entirely operated from home.
Material Cost
You need to have funds to purchase the right material for your business. It can be anything from raw materials to office fixtures and other similar things that you need in order for you to start your business. Without the right material, you will not be able to start or run your business.
Operating Cost
Every limited company needs money to run. This is called operating cost. Once the business starts earning profit, the operating cost is taken from the yearly profits however when you are starting out in the business world, you limited company will need to inject operating cost from the outside. You may even have to cover for some losses until the company hits breakeven. So you need to get those funds arranged before you start your limited company.
Salary of Initial Employees
Starting a business isn’t always a one person show. If you have people helping you out in starting the business then you need to pay them accordingly and you will need to arrange funds to do that.
Other Miscellaneous Expenses
In addition to above mentioned costs you may also incur other miscellaneous expenses so it is better to have some funds lined up on the side. Those funds will give you a cushion of security in case there is an issue. Those funds can also be used to cover miscellaneous expenses.