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My Mum Wants To Start A Cleaning Business In Uk. Need Some Help On Taxes And Research?

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My Mum Wants To Start A Cleaning Business In Uk. Need Some Help On Taxes And Research?

Postby seafra » Sun Oct 01, 2017 9:37 am

Hello! My Mum wants to start her own cleaning business. We Live in between 2 villages one very big and one small. She would have one competitor locally.

A Few Questions I would like to ask as there information I have is very spread out and hard to gather everything.


What taxes would she have to pay? She would have 2 employees me and her.

How do I go about finding demographics for our village or information on people living in the area and find how many people we actually have as potential customers.


What company type would we be best to go with such as ltd etc?

Where do I need to register as a business?

Any other info would be great! Thanks a lot!
seafra
 
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My Mum Wants To Start A Cleaning Business In Uk. Need Some Help On Taxes And Research?

Postby Brookson » Tue Oct 03, 2017 4:38 pm

Forget being a LTD, just register as a sole trader on the HMRC website

they issue a UTR -unique tax reference number for tax purposes

Yes she will pay tax on her net profits,if they are over £8105 for the tax year 2012-2013

She can also pay her own N.I. by direct debit

She'd be the owner of the business and you'd be her employee, presumably ?

As for customers, that's for you to find out

Get leaflets printed up and literally post them through people's letterboxes

Take out an advert in a local paper, put up adverts in local shops too

Everyone has to start somewhere, in time 'word of mouth' will be your best advert
Brookson
 
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My Mum Wants To Start A Cleaning Business In Uk. Need Some Help On Taxes And Research?

Postby Brown » Tue Oct 03, 2017 9:32 pm

http://www.businesslink.gov.uk/bdotg/act...
Brown
 
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My Mum Wants To Start A Cleaning Business In Uk. Need Some Help On Taxes And Research?

Postby Vokivocummast » Thu Oct 05, 2017 9:25 am

1.
Tax

You would have to pay income tax on any profits assuming you have no other income the tax rates for 2012/13 are as follows:

0-£8,105 0%

£8106-£34,370 20%

£34,370-£100,000 40%

After £100,000 it gets more complicated as you lose your tax free element but effectively you increase to 50%.

National insurance

You pay Class 1 National insurance as an employee at 12% up to £817 per week and then 2% on any excess. As self employed you pay £2.65 per week class II NIC. Then 9% class IV NIC on profits between £7,605-£42,475. Then 2% on the excess.

Tax should be built into your projections as it is a cost like everything else.

2. Trading Entity

Assuming that you want to keep things simple and you will both be sharing the profits a conventional partnership would be appropriate. As you would both own the business you would not be employees but self employed. You should write down how you are going to share the profits to avoid any arguments down the line.

You would need to register both yourselves and the partnership with HMRC for self assessment.
This can be done here.


http://www.hmrc.gov.uk/sa/register.htm

Each year you would need to complete accounts for the business and then record them on the tax returns.
The tax returns are due to be submitted on 31 January following the tax year that the accounts end in.
The tax is due on the same day.

The only disadvantage of not having a company is that you will not have limited liability so make sure you have sufficient insurance in place in case you damage something or kill someone!

3. Research

In terms of demographics the following government site should help.

http://www.neighbourhood.statistics.gov.uk/dissemination/

I'm not sure what you are trying to obtain from the demographics but the census should help.

3.
General tips

The key is plan, plan, plan and plan some more.

Your first step is to set up a business plan to see if your idea is viable.

a) What exactly is your business i.e. general cleaning or specialist like oven cleaning

b) Ask some people if it is a good idea (Not family or friends)

c) What do you need to get it up and running, stock, assets, advertising etc/

d) How much are you going to spend setting up and running the business?

e) How much profit do you need to make to live off?

f) Where is your money going to come from to finance this each month

g) Who are your customers and why will they buy your product/service? How many customers do you need to make a profit.

h) How much are your competitors charging and what service are they offering

i) Can you offer it better cheaper etc etc.

Once you have written the above down project twelve months into the future as to income and expenses being realistic. Then add an additional 20% "contingency" for unknown expenses.

After all that are you making enough money to live on? If so consider going for it.


Check out my blog below for some tax tips or if you would like me to write an article suggest a subject :)
Vokivocummast
 
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My Mum Wants To Start A Cleaning Business In Uk. Need Some Help On Taxes And Research?

Postby Evoy » Fri Oct 06, 2017 3:03 pm

There are a lot of sites that can help you. I clean small offices and have a Squidoo lens and blog about starting cleaning businesses. They have tons of tips and resources on them-the links are in My Profile. Depending on what type of cleaning business you plan to do, you probably need to check with your local government office that does fictitious name files, etc, (here in the USA it's the city clerk's office) to see if you will need any kind of permit or license. If it's not required, get it later when you need to open a business bank account. You really should get some type of liability insurance, though. Call a lot of insurance agencies and get quotes for the smallest amount to start. The rate varies a lot so do call around. It will protect you from claims (usually false) of damages or theft. Plus it's a great sales tool. I have more on the lens and blog. Good Luck to you!!
Evoy
 
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