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Your First Month Running A Company

Registering a company is an exciting time. If this is your first company, congratulations! Now let’s make sure you’re doing everything you should by focusing on what you need to do in the first month of running your company.

By taking a week-by-week look at the first month of company ownership, you should understand what happens and when. However, this can look different for some companies and may also depend on how quickly paperwork arrives in the post.

First Week

The first week after incorporation is an exciting time. You should receive documents confirming that the company legally exists.

  1. Certificate of Incorporation
  2. Memorandum and Articles of Association

When you open a business bank account, the bank will ask for these as proof that the company exists.

Remember: a limited company is its own legal entity, and these documents prove that it exists. Keep them safe and secure.

Companies House authentication code

Your Companies House authentication code, also known as your “web filing code”, is a 6-character alphanumeric code issued by Companies House. You’ll need this code to submit your annual Confirmation Statement, update your company details (if required) and make structural changes to the company, such as adding new directors.

Companies House views the code as equivalent to an officer’s signature and should be treated as such. If another individual knows your code, they could use it to make changes to the company.

Typically, you’ll be issued a web filing auth code upon incorporation. If you used Company Wizard to incorporate your company, we’ll show you the auth code on the company overview. However, if you do not see it here, or if you’ve lost it, you’ll need to request it from HMRC.

Set up your Government Gateway account

Your Government Gateway account is where you manage everything tax-related. Before you can do anything relating to tax, you’ll need to wait for your Unique Taxpayer Reference (UTR) to arrive in the post; this is usually sent to you shortly after incorporation.

Once you’ve set up your Government Gateway account, you can:

  • Register for Corporation Tax
  • File company tax returns
  • Register for VAT (if applicable)
  • Register for PAYE (if applicable)

Second Week

Hopefully, all the paperwork arrived by post during the first week, or you accessed the necessary documents online. Once you receive them, it’s time to start managing money.

Business bank accounts

As a limited company, the business is a separate legal entity from you and should therefore have its own bank account. However, there is no legal requirement for this.

Without a business bank account, it can be difficult to track business income and expenditure, which can complicate your accounting records, especially when it comes time to pay taxes and submit your annual accounts.

For more information on business bank accounts, check out our previous post: Tips to Open a Business Bank Account in the UK for your Limited Company.

Set up bookkeeping

Although you might use the terms bookkeeping and accounting interchangeably, they are two distinct concepts.

  • Bookkeeping is the act of record-keeping. Ensuring every transaction and invoice is logged correctly.
  • Accounting is the deep dive into the numbers and what they mean for the business.

The first step in ensuring everything is recorded correctly is choosing which software to use. Our sister company, Quickfile, is a good place to start for bookkeeping, since you can record everything in one place. 

At a minimum, you should be keeping track of:

  • Transactions in and out of the business
  • Receipts and invoices
  • Money owed to the business and money the business owes to others

Once you have these basics in place, an accountant can help you keep on top of statutory filings. For more information about accounting and statutory filings for business owners, check out our previous blog post: Does My Limited Company Need An Accountant?

Third Week

You now have everything in place to start trading. But within three months of starting to trade, you need to register for Corporation Tax.

Companies House classifies the following as trading:

  • Selling goods or services
  • Advertising or marketing
  • Employing staff
  • Buying stock or equipment

If your company has started any of these activities, the clock has started for registration. If you register late, you can be fined and receive penalties, even if your company makes little to no profit.

Decide about VAT registration

This can be difficult to gauge within your first week of trading, but you must register for VAT if you expect to receive more than £90,000 in taxable turnover in the next 30 days.

If your turnover is less than £90,000, you can voluntarily register for VAT, which can make you look more attractive to do business with.

For more information about VAT, including how to register, check out our previous post: VAT - What is it and how do I register?

Fourth Week

You’ve now been running for almost a month, so it’s time to start learning about statutory filing and maintaining compliance.

Your statutory records should all be in place already; you simply need to maintain them and update them if anything changes with: 

Although you shouldn’t need to do them yet, it’s good practice to start your company with a solid understanding of your ongoing obligations, such as:

  • When to file a confirmation statement
  • What needs to be included in the annual accounts
  • How to submit a Company Tax Return

If you miss the deadlines attached to these statutory filings, your company can face penalties and strike-off action, meaning it’s important to understand what you need to do and when you need to do it.

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