Approvals and registrations you need before trading

Universal registrations every business needs

Regardless of your sector or business structure, you must register with HMRC for tax purposes and, in most cases, pay the ICO data protection fee. If you form a limited company, you must also register with Companies House. These are non-negotiable requirements — trading without them is a criminal offence.

The deadlines vary by registration type. Some have fixed windows (such as registering for self-assessment within three months of starting to trade), while others are triggered by specific events (such as registering for PAYE before your first payday).

Data protection registration

Most businesses that process personal data must pay an annual data protection fee to the Information Commissioner's Office. The fee tier depends on your turnover and number of employees. A small number of exemptions exist, but they are narrow — most businesses need to register.

Activity-triggered licences and permits

Beyond universal registrations, many business activities require specific licences or permits before you can legally operate. These are issued by different bodies — local authorities, national regulators, or government agencies — depending on the activity.

The GOV.UK Licence Finder is the best starting point for identifying which licences apply to your specific business activities and location. It covers over 30 government departments and hundreds of licence types.

Professional and sector-specific registrations

Some sectors are regulated by professional bodies or national regulators. In these sectors, you cannot trade at all without first obtaining registration or authorisation. The application process can take weeks or months, so you need to start early.

Unlike activity-triggered licences (which are typically issued by local authorities), professional registrations involve national regulators with their own application processes, fees, and ongoing compliance requirements.

Insurance you must have before trading

Certain types of insurance are required by law. The most common is employers' liability insurance, which you must have from the day you hire your first employee. Other mandatory insurance depends on your business activities — for example, motor insurance for business vehicles and professional indemnity insurance in some regulated professions.

Operating without required insurance is a criminal offence with daily fines. Arrange cover before you begin the activity that triggers the requirement, not after.

What happens if you trade without required approvals

The consequences of trading without the correct approvals range from fixed penalty notices to criminal prosecution. The severity depends on the type of approval you are missing and whether the breach was deliberate or inadvertent.

How to work out what you need

Start with the universal registrations — every business needs these. Then use the GOV.UK Licence Finder to check for activity-triggered requirements. If you operate in a regulated sector, contact the relevant professional body early. Finally, check your insurance obligations before you hire anyone or start using vehicles for business.

Allow at least three months before your intended trading date to complete all applications. Some approvals (such as premises licences) can take two to three months to process, while others (such as Companies House registration) can be completed in 24 hours.