Setting Up In The UK: Terms of Business   

When you set up in the UK and you have your entity in place, it is important to list your terms of business, which should be as clear and succinct as possible. Your terms of business in the UK are subject to UK law.   

However, the main point so often overlooked by companies setting up in the UK is Terms of Payment specifically for the UK market. UK companies are used to paying 30 days from date of invoice, or on presentation of invoice. 

Questions to ask yourself at this stage: 

  • What are your payment terms?  
  • Is it payment on instruction or over a 7/14-day period?  

These terms are small factors that act as an essential part of your cash flow because once you have your agreement in place with your client and have your entity in place, you want to be able to receive funds and raise invoices.  

If giving generous payment terms is part of the sales strategy, then that’s your decision. Otherwise, seek advice as to what might be acceptable. You may be pleasantly surprised, and it could benefit your cash flow. 

The method of payment is generally expected to be electronically nowadays: cheques are becoming less common. Settling invoices and paying employees can be done by BACS, CHAPS, or direct transfer directly into their bank account. 

From our side, we are accountants and legal advisers. We can review most things and we are very good at doing this however, on certain occasions we recommend speaking with law firms who specialise in this area. Terms of business in the UK are subject to UK law so it is important that these comply.  

For further support on how we can support your UK or European market entry, or for an introduction to a law firm for support, please do get in touch.