Top Ten Tips to help your funding journey
Essential advice for anyone starting or growing their business journey. These insights are designed to help you navigate the financial and operational landscape with confidence.
01
Know your credit status
Check your personal credit report regularly. We suggest www.checkmyfile.com. This includes reports from the 3 major UK agencies.
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Whenever you check insurance or credit card costs, the lenders will do a “soft check” on your credit file. This may cost a few points but remember – the consolidators may ask up to 40 or 50 providers and each one may appear on your credit report (this could result in a temporary drop of 200 points!). The score will eventually correct itself; the imprint remains. This can be particularly annoying if you have been looking for a credit card or other forms of borrowing. Lenders do not like to see applicants with a string of enquiries to lenders – it smacks of desperation.
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You may not know you have a CCJ (County Court Judgement). This particularly affects younger people who may have been at university in another city. After they graduate, they may move to another place and rarely provide a forwarding address. You often don’t know about it until you apply for credit and are refused…
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CCJs will stay on the register for 6 years, even if they are paid off. Some lenders may require a period of time between a satisfied CCJ and a lending offer.
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Individuals in formal Debt Management Programmes (sometimes called an IVA) should not apply for credit. Same goes for bankrupts until they have their discharge notice.
02
Register on the Electoral Roll
Ensure you are on the Electoral Roll – you can register here using this link
03
Sort out your ID
Make sure your ID is up to date:
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Passport – ensure its valid for at least 6 months.
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Driving Licence – ensure your address is current
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Bank Accounts - ensure your address is current
Your ID should be consistent across all of these items. If your name and address are not shown identically, then get them changed
04
Is your banking on track?
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Your last 3-months bank statements must have been operated within your banking agreements (stay within your overdraft limits).
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If you have returned/unpaid Direct Debits or Standing Orders, these can be an issue with some lenders. Try to line up your regular payments to be taken after regular funds come in. Most of your service providers will allow this.
05
A trap to avoid
Try to avoid payday loans. These are a signal that you may not be fully in control of your finances and are a warning light to lenders. As a one-off, they are probably ok but if you are using a series of them or rely regularly on them, you need a personal finance check-up. Lenders want to see that you are in control of your own finances; if you are good with your own money, you will probably be good with theirs!
06
Premises/Vehicles
If your business will need premises, get Heads of Terms from the agent or landlord.
If your business will need a vehicle, ensure you have a full, not provisional, licence.
07
Do not put this off
Get insured.
08
Whose money is it?
If you are new to self-employment, you need to get some basic financial disciplines in place.
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Get a separate business account – even if you are a Sole-trader.
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Pay yourself a set amount each month.
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Never use the business account for the odd Big Mac or coffee.
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Never use the business account for anything except business matters.
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If your business is likely to need VAT registration (threshold is currently £90,000 sales per year), then you should start your business as VAT registered. Businesses that change to being registered risk losing regular customers when their prices go up 20% overnight!
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Always keep VAT in a separate account. 99% of businesses struggle when the VAT return is due. Keeping the funds separate will allow you to sleep at night.
09
How to sleep easily at night
Get a bookkeeper. You can find one in your area using this link
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Accountants are ok for telling you what you did last year; they may not have the facility to advise you on a week-by-week basis.
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The bookkeeper will keep your finances, and you, in order. Listen to them.
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Bookkeepers don’t charge the earth. You certainly don’t need to employ one full-time (although it will be a measure of your business success when you do need one on the payroll).
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For a monthly fee of £200 or so, they will keep things in order, sort out your VAT and PAYE issues – and complete your annual tax return
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The bookkeeper is worth their weight in gold! This is the best free tip you will ever get.
10
Actually, 9 rules should be enough...
Resource Directory
Essential resources to support your professional growth and journey
01
Business Insurance
Vital for every enterprise. We advise engaging a specialist broker to ensure comprehensive risk protection.
03
Banking
Traditional banks often delay startups with rigid criteria. Experience the freedom of modern finance by opening a Tide account today. Streamline your operations with fast, flexible business banking now.
04
Company Registration
04 Company Incorporation Should you require business registration, we have utilised this trusted service for many years. We strongly advise opting for the full secretarial package. This mitigative measure ensures all Companies House filings are handled professionally, preventing the costly penalties associated with late submissions or regulatory changes.
05
Payments Registration
Most businesses need to collect cash at the time of sale. Nobody likes to give credit anymore! I have used this provider for a number of years and can recommend them for simplicity of sign-up and processing. The cash comes through the next banking day as standard.
Many of your customers may like the option to split payments - try Klarna or PayPal for excellent solutions.
06
Tax and VAT
If you will be trading above the threshold for VAT (currently £90,000 annual turnover) you need to register for VAT as soon as you have registered your business (immediately if you will not be incorporating). The reason for this is that once you are VAT-registered, you will get your first VAT Return in 3 months. This will allow you to claim back any VAT expenses you may have incurred setting up the business (e.g. VAT Licence fees). You can claim VAT back even if you haven’t started trading by then.
Beware of organisations who want to set these up for you. They may charge you a lot of money for what is basically a free service! Don’t be ripped off, go directly to the government website.
Frequently Answered Questions
VAT
Do I need to register?
If you are expecting your business to sell more than within £90,000 in 12-months then you will have to register.
When should I register for VAT?
You don't have to do it immediately, but if your business works on getting repeat orders, then you shoud register before you start. The reson for this is that customers do not like to change from paying non-VAT rate to the extra 20%. Therefore, if you are registered from Day 1, you will not experience potential loss of customers.
If you are setting up your business now, register for VAT at the same time. Your first VAT return will be made 3-months from date of registration (regardless of whether you are trading by then or not). This will allow you to reclaim VAT on startup expenditure (equipment, Licence Fees, premises, vehicles) and can be a welcome cash boost in early days of the business.
Mortgages
If you are thinking of applying for a mortgage, try to do it before you start to apply for business finance.
Every finance application will have a negative effect on your credit score. If you apply for funding (or insurance) on websites linked to multiple providers, your credit rating may drop sharply. It will come back after 2-3 months.
CCJs and IVAs (or other debt management programmes).
If you have any of these, your chances of getting funding are slim. It is worth getting a full credit report to check your record is clean. (Many people find they have unknown CCJs often going back to when they were students. They leave university and move away and leave their old phone contracts to die. Unfortunately, mobile phone companies have a habit of slapping CCJs onto people who don't pay final bills and change address...)
For a confidential chat
Privacy notice
Privacy Notice – BM Finance Limited
We take your privacy seriously and are committed to maintaining the trust and confidence of our clients, visitors to our website and subscribers to our newsletter. Maintaining the security of your data is critical and we have implemented measures to ensure your privacy rights are respected and applied. We commit to process your data fairly, legally and to be transparent about how we do so. This notice, which applies whether you use our services or use our website, explains our approach to data integrity and your individual rights. It does not apply to pages hosted by our referral partners, independent consultants and associates. By applying for business finance you consent to the collection, use and transfer of your information under the terms of this notice. Put simply, we set out what we are going to do with your data in this Privacy Notice.
We ask you to read this Privacy Notice to ensure you are happy with the way that BM Finance Limited will process your data. We ask you to confirm that you agree with our Privacy Notice when you confirm your decision to enter into a loan application with us. We provide the option to opt in to the different marketing options that you prefer.
The processing of personal data is governed by the General Data Protection Regulation 2016/679 (GDPR). The notice may change from time to time so please check for updates. If you need further details or are unsure in any way, please contact us at finance@bm-fin.co.uk.
Who are we?
BM Finance Limited is a Limited Company registered in England. (referred to as “BM Finance Limited”, “we”, “our” or “us” in this notice). Our registered number is 11633429. Our registered office is 4 High Street, Buckingham MK18 1NT. As a Business Advisor, we are both a data controller and a data processor, as defined by the GDPR. For applicants who apply via our website, your data is shared with the Finance Brokers or Providers. If you would like more information about how the Finance Brokers or Providers handle your personal date, please consult their Privacy Policy.
What personal information do we collect and process?
We collect and process your data in the following circumstances: When you apply to BM Finance Limited for a Finance application support, When you complete the contact form on our website.
BM Finance Limited may collect the following information about you: Your name, date of birth and gender; Your ethnicity, qualification levels and employment status; Your contact details: postal address, telephone numbers (including business, personal & mobile numbers) and e-mail address; Your existing financial commitments; Your communication and marketing preferences; Your location; Your correspondence and communications with us.
This list is not exhaustive and, in specific instances, we may need to collect additional data for the purposes set out in this notice. Some of the above personal data is collected directly, for example when you engage with us. Other personal data is collected indirectly, for example your browsing activity. We may also collect personal data from third parties who have your consent to pass your details to us, or from publicly available sources.
Why do we collect and process your personal information?
We only collect and process the information needed to effectively provide our services to you when applying for a Start Up Loan, as well as for contact and communication purposes. We will use your personal information as part of the reporting process we have agreed with our partner organisations. We provide reports on our activity as per agreements with organisations for whom we deliver programmes.
How is your personal information used?
We use your personal data: To provide services to you; To effectively communicate with you; To respond to your enquiries; To make our website and other social media content available to you; To verify your identity; To assess your eligibility for the Start Up Loans programme, including assessing lending risks and obtaining a credit reference; For crime and fraud prevention, detection and related purposes (if mandated by law); To contact you (with your agreement) electronically about promotional offers and services which may interest you; For market research purposes and to better understand your needs; To enable us to manage service interactions with you; To ensure compliance with our contractual obligations, including auditing and reporting, we have in providing our service to you; Where we have a legal right or duty to use or disclose your information (for example in relation to an investigation by a public authority or in a legal dispute); Help improve our products and services, for quality control, security, internal record keeping and other business needs.
Certain types of personal information, such as gender and ethnicity, are used only as part of our contractual reporting requirements, for the purposes of monitoring and promoting equal opportunities.
The lawful basis for processing your personal information: Legitimate interest - We may collect, hold and process your personal data on the basis of legitimate interest where it is necessary in order for us to fulfil our needs as a business and to be able to provide you with our services, including, but not limited to: To send you information about your loan; To provide details of the benefits available as part of the loan agreement; Protecting customers, employees and other individuals and maintaining their safety, health and welfare; Promoting, marketing and advertising our products and services; Understanding our customers’ behaviour, activities, preferences, and needs; Improving existing products and services and developing new products and services; Complying with our legal and regulatory obligations; Preventing, investigating and detecting crime, fraud or anti-social behaviour and prosecuting offenders; Handling customer contacts, queries, complaints or disputes; Protecting BM Finance Ltd. by taking appropriate legal action against third parties in breach of legal obligations; Effectively handling any legal claims or regulatory enforcement actions; Fulfilling our duties and obligations to stakeholders.
Consent - We collect, hold and process your personal data on the basis that you give us consent when you accept this Privacy Notice. We will seek your consent to hold and process your data when you sign up to our mailing list or we need to ask for any sensitive data as part of the application process. You remain in control of the personal data you share with us. You can change your preferences at any time.
Vital interest - We may use your personal information to contact you if we reasonably believe that the processing of your personal data will prevent or reduce any potential harm to you.
Legal Obligation - We may use and process your personal data to comply with our legal obligations such as HMRC requirements, if it is genuinely needed for law enforcement, or to verify the accuracy of your data.
Credit reference and fraud prevention agencies - When you apply for a loan, any of the services we provide will check our own records and may also carry out a search through credit reference agencies on you. Credit reference agencies collect and maintain information about consumers’ and businesses’ credit behaviour. We use information from credit reference agencies to help make decisions, detect and prevent crime, check your credit history, and verify your identity.
If we need to make a credit decision, your records will be searched, along with those of anyone who is financially associated with you. The credit reference agency will keep a record of this search. We may give details of your loan account and how you conduct it to credit reference agencies. You have a right to apply to the credit reference agencies for a copy of your file. We carry out most of our credit searches using Experian or Checkmyfile. Their addresses are: Checkmyfile (www.checkmyfile.com), Equifax (www.myequifax.co.uk), Experian (www.experian.co.uk).
We have processes and systems that protect our customers and ourselves against fraud and other crime. We will share your personal information from your application with fraud prevention agencies. Law enforcement agencies may access and use this information.
Other third parties - Aside from our service providers, we will not disclose your personal information to any third party unless we are legally obliged to do so, or you provide your consent. We will never sell or rent our customer data to other organisations for marketing purposes.
Where your personal information is stored: Your information is stored on dedicated hardware used by BM Finance Limited and all data is held and backed up within the UK or EU, or is covered by the EU-US Privacy Shield Framework. We use OneDrive for Business for the storage of electronic files. Where you communicate with us by email, we may store copies of the emails.
How we keep your personal information secure: We are committed to keeping your personal data safe and secure. Our security measures include encryption, backup, password management, risk management, and regular cyber security assessments. Only authorised and trained personnel can access your personal information.
How long we keep your personal information: We will not retain your data for longer than necessary. Successfull loan applicants: six years after fulfilled obligations. Unsuccessful loan applicants: six years after applied.
Automated decision making: We may retain some data for reporting after removing all personal information (anonymisation).
When do we collect your information? Website forms - Our website has forms built using Gravity Forms. Your personal data will be stored in the website’s database and automatically deleted after five years. Online data management (analytics and security) - We collect information about your computer and visits to find out things such as the number of visitors. This information does not identify anyone. Website security and backups - Our website has HTTPS encryption. Links to Other Web Sites - This Privacy Notice does not cover the links within our site linking to other websites.
International transfers: it may be necessary for us to share your data outside of the European Economic Area. If this happens, we will ensure that the transfer will be compliant with data protection law.
How you can help protect your personal information: We recommend that you always log out and close the website browser when you complete an online session. Keep your account passwords private and use strong passwords.
Your rights: We fully support the ability of people to exercise their rights in respect of the personal information supplied to others. If you wish to correct, complain, object or otherwise control the data we hold please contact us.
Overview of rights: Access to personal information; Correction of incorrect data; stop using for direct marketing; stop any consent-based processing; withdraw consent at any time.
Getting in touch with BM Finance Limited: 4 High Street, Buckingham, MK18 1NT. Phone: 07787526163. Email: finance@bm-fin.co.uk. Registration number: A8630100.