How Much Does it Cost to Start a Takeaway in London?

The cost of commencing a takeaway restaurant in the UK varies depending on your location. In metropolitan areas like London, the price tag can climb as high as £100,000. However, in less urban areas, you may get started for as low as £5,000. The expenses fluctuate based on factors like available properties and required renovations.

Why Starting a Takeaway Business in the UK is a Savvy Choice?

The prospect of commencing a takeaway business in the UK is more enticing than ever, and the numbers tell a compelling story. Recent statistics from the Office for National Statistics reveal a steady increase in the food services and accommodation sector, with a 29.8% year-on-year revenue growth in 2023. This surge in demand is reflected in the fact that, on average, Britons spend £1,320 per year on takeaway and delivery food. With a growing preference for convenience and diverse culinary experiences, the takeaway industry has become a vibrant market. The rise of food delivery apps has further fuelled this growth, making it easier for customers to access their favourite dishes. As the trend towards healthier and sustainable eating gains momentum, there's also a growing market for takeaways offering nutritious and eco-friendly options. This presents an ideal opportunity for entrepreneurs to tap into a market valued at £11.3 billion in 2023. So, if you're considering starting a takeaway business, the numbers undeniably support the idea, offering a promising path to success in the UK's thriving culinary landscape.

How to Start a Takeaway Business from Home in UK?

Running a takeaway business from the comfort of your home is an enticing prospect. Not only is it a convenient way to generate extra income, but it's also surprisingly accessible. Here's what you need to get started:

Things You’ll Need to Get Started a Takeaway Restaurant in the UK

• Business Plan: Begin with a detailed business plan that outlines your strategy, expenses, and timelines. Decide whether you want to create a unique brand or opt for a franchise model.
• Company Registration: Register your business with the government. This process involves obtaining a company number and a unique tax identification number.
• Licenses and Permits: Acquire the necessary licenses and permits from local authorities. Budget for an average cost of around £300 per year.
• Location Hunting: Choosing the right spot is crucial. Accessibility, parking, and the local business ecosystem should factor into your decision.
• Funding: Secure the capital needed for your venture. You can explore loans, grants, or tap into existing resources.
• Marketing Strategy: Develop a comprehensive marketing plan that covers social media, traditional advertising, and more.
• Supplier Network: Build reliable relationships with suppliers to source high-quality ingredients.
• Hiring Staff: Employ a manager, chef, and waitstaff, focusing on customer service skills.

How to Register for VAT Online?

To launch your takeaway restaurant, VAT registration with HM Revenue and Customs (HMRC) is essential. You can do this online or via phone. If you need expert advice on this, don't hesitate to contact LOYALS, who have over 15 years of experience working with restaurants and takeaways.

How to Prepare VAT Return?

Preparing a VAT return may seem like a daunting task, but with the right approach and understanding, it becomes a manageable and essential aspect of your business. In the UK, VAT is a tax on the value added to goods and services at each stage of production or distribution. As a business owner, it's your responsibility to collect VAT from your customers, keep accurate records, and submit regular VAT returns to HM Revenue and Customs (HMRC). Here's a step-by-step guide to help you navigate the process:

1. How to Record Your VAT Transactions?

• Start by keeping meticulous records of all your business transactions. This includes sales, purchases, expenses, and any other financial activities related to your business. Digital accounting software can greatly simplify this process.

2. How to Determine Your VAT Liability?

• For each VAT period, calculate the amount of VAT you've charged your customers (output tax) and the VAT you've paid on business expenses (input tax). The difference between these two figures is what you owe or what you can reclaim.

3. How to Choose the Right VAT Scheme?

• The UK offers various VAT schemes, such as the Standard Scheme, Flat Rate Scheme, and Cash Accounting Scheme. Depending on your business's size and nature, select the scheme that best suits your needs.

4. How to Set Up VAT Codes?

• In your accounting software, establish VAT codes for different types of transactions. This will help you automatically categorise transactions as standard-rated, reduced-rated, zero-rated, or exempt for accurate VAT calculations.

5. How to Calculate Your VAT? 

• Once you've recorded your transactions and set up VAT codes, your accounting software should be able to automatically calculate the VAT you owe or can reclaim. Ensure your VAT calculations are accurate to avoid discrepancies with HMRC.

6. How to Complete Your VAT Return Online?

• Using HMRC's Making Tax Digital (MTD) platform, you can complete your VAT return online. Make sure to submit your VAT return by the due date to avoid penalties. You'll need to log in to your HMRC online account and follow the prompts to file your return.

7. How to Pay Any VAT Due?

• If your VAT return shows that you owe VAT, ensure you make the payment to HMRC by the deadline. Timely payments are crucial to avoid interest and penalties. One tip on avoiding vat penalties is to keep in mind deadlines, however running a business and paying attention to tax deadlines is not an easy task. This is why you can outsource your vat accounting with LOYALS Accountants & Business Consultants with over 15 years of experience working with restaurants and takeaways in the UK.

8. How to Keep VAT Records?

• Maintain thorough records of your VAT transactions, including invoices, receipts, and bank statements. These records should be kept for at least six years in case of an HMRC audit.

9. How to Seek Professional Advice? 

• VAT regulations can be complex, and it's easy to make errors that could lead to penalties or overpayments. Consider consulting with an accountant or tax professional, especially if your business deals with complex VAT issues or international transactions.

Incorporating VAT returns into your regular financial routine is essential for maintaining compliance with tax regulations. Efficiently managing your VAT responsibilities will not only prevent potential legal issues but also help you make informed financial decisions for your business. If you need expert assistance in preparing your VAT returns or understanding the intricacies of VAT, don't hesitate to contact LOYALS Accountants & Business Consultants.

Insurance for Takeaway Businesses 

Consider the importance of insurance for your business. While you might think it's unnecessary, it provides crucial protection. Accidents can happen, and insurance can save you from unexpected financial burdens.

Final Thoughts