This document provides advice and information for starting a creative business, including how to register a company, get business banking and tax accounts, manage VAT payments, apply for funding, sell internationally, and eventually shut down the business. It recommends enlisting an accountant to handle tax filings, using bookkeeping and accounting software to stay organized, and considering insurance for your business. The author shares their experience owning multiple creative businesses in the UK, US, and Estonia.

1. A practical introduction to
starting a creative business

2. (or all the things I wish
people had told me about
when I was 26).

3. I am not a lawyer
or accountant.
Do your own research!

4. Alexandra Deschamps-Sonsino
alex@designswarm.com
@iotwatch on twitter & insta
I don’t use Facebook

5. About me
Industrial & interaction designer
First UK distributor of the Arduino

7. About me
Founder of Good Night Lamp

8. Who are you?
What brought you here today?

9. What has prevented you
from opening a business?
What are you worried about?
What scares you?

10. I currently own
2 UK businesses
1 US subsidiary
1 Estonian business

11. I currently own
2 UK businesses
Designswarm Industries Ltd
Good Night Lamp Ltd
1 US subsidiary
Designswarm Industries Inc.
1 Estonian business
Designswarm Industries OU

12. Before that
3 UK business which were dissolved
Tinker.it Ltd
(2007-2010)
Anything Labs Ltd
(2013-2015)
The Internet of People Ltd
(2013-2014)

13. A business is a Welsh blanket.
It protects you from the elements.

14. A business is a Welsh blanket.
It protects you from personal bankruptcy.
It allows you to work with very big companies.
How it does doesn’t affect your
personal credit score.

15. A business is a box.
It’s a good way to work with people
you’ve never worked with before
in a structured environment
where the risk is managed.

16. A business is cheap &
easy to set up.
It is also easy to close down.

17. Your best friends when running a business:
Your accountant
Your bookkeeper
Your accounting software
A good filing system
A good binder
HMRC & Companies House

18. Your accountant can take care of:
Your registration
Your VAT returns (if you earn over £70K) every quarter
Your End of year accounts
Your Corporation tax return
Your Payroll (if you have employees)
Your personal tax return (£0)

19. A bookkeeper can take care of:
Collecting & sorting all your receipts
Putting them into your accounting software
Have everything up to date for your VAT returns
You can also decide to do this yourself

20. Accounting software online will help you:
Invoice your clients online easily
Keep an eye on your sales & expenses
Keep an eye on VAT returns
Keep an eye on how well your business is doing

21. A good filing system that you keep safe:
Sort your receipts by month in an expanding file.
Buy one for every year.
Store them with lovespace as you have to keep records
for 6 years after you close a company.

22. What do you need to do?
Your registration
Your VAT returns (if you earn over £70K) every quarter
Your End of year accounts
Your Corporation tax return
Your Payroll (if you have employees)
Your personal tax return (£0)

23. Register a company
Companies House website
Costs £100 or £200+ with an accountant
You can be using a different name than the name you
register with. This is called your trading name.
Let’s look for a name for your company!

24. Getting a business bank account
Try HSBC especially if you think you’ll do business
internationally.
Make an appointment with a business
banking advisor.
Come with your ID, proof of address,
registration documents and business plan printed out.

25. Getting a VAT number.
You don’t have to register for VAT if your turnover is
less than £85 000.
You can only register for VAT if you have a bank account
as HMRC will pay into (or take from)
your account auto-magically.

26. VAT
VAT is 20% that you add on top of your services.
VAT you owe every quarter is calculated by:
VAT you charged-VAT you paid (from your suppliers).

27. How to manage VAT payments
Keep a savings account with 40% of money coming in
to cover what you might owe in VAT and corporation tax.

28. End of year accounts
You file accounts for the year prior.
In December, I filed accounts for 2016.
So you need to hold on to your savings for that year
for a long time.
Check your accounting software as you go!

29. Corporation tax
20% of your profits that year which you will need to
pay to HMRC.
You can ask for a delay in paying this, just call them.

30. Your personal tax return
Ideally you are an employee of your own company
so you get your P45s, a pension, PAYE and NI paid
for you by the company.
This means you will get a symbolic salary under
the minimum taxable income so you don’t pay
taxes twice!

31. Insurance
As a business you can get Indemnity insurance
and employee liability insurance.
Many large businesses need this to work with you.
It might cost you £79+/mo

32. Funding
European & Innovate UK funding are open
to registered companies.
There is tax relief for your R&D work.

33. Selling to the US
You can set up a subsidiary of your UK business in
the US using Atlas Stripe service.
You get a bank account with the digital bank Silicon
Valley Bank and your business is based in Delaware.

34. Brexit!
We will become 20% more expensive as we
will have to charge VAT to European customers.

35. E-Estonia
Estonia has a e-citizen program that lets you set up
a company in Estonia and set up a bank account
online using digital banks.

36. Shutting down a company
You can close a company in writing if you don’t
owe anyone any money.
You can let it become dormant.
You can dissolve a company with an insolvency
company if you have debts you can’t manage.
This will cost you around £5-6K.

37. Questions?