Manage my retail administration

Manage my retail administration

5 August 2022

Ankorstart explains how to manage the administrative aspect (declarations, taxes, subsidies) of your shop. The administrative workings will no longer hold any secrets for you.

16 Minutes

Opening a retail store is the goal of many entrepreneurs across the UK. The chance to create a successful, sustainable business that you control completely is a widely held goal. Small business owners can set their own hours, provide employment opportunities for others and hopefully end up making a good profit. Taking an initial concept and seeing it come to fruition as a successful retail store is an immensely satisfying experience. 

If you are considering opening a retail store, you need to know exactly what legal steps to take. Far too often, new business owners do not have a full understanding of their rights and obligations. Knowing what you need to do can help to simplify the sometimes-complicated process of opening a retail store

Good to know: Independent retail is making a comeback in the UK

Recent figures show that the number of new retail stores in the UK has hit a four-year high. Conversely, the number of large chain stores is dwindling. Good news for small retailers!


What legal steps do I need to take to open my retail store? 

So, you have a fantastic idea for a retail store, developed a business plan and now you are thinking about opening. Before you rush ahead and sign a lease, there are a few initial legal steps to take. Go over the below list to find out the right way to open a retail store.

Good to know: There is government assistance for small retail stores

Some more good news for potential small retail store owners: the UK government has extended the Business Rates Retail Discount for retail properties. More information can be found here. ²

Decide on a unique name for your business

The first step is to spend some time deciding what to call your business. What name you choose for your business is important for your marketing, but it can also have legal ramifications. 

Choosing a name that is too similar to an existing business could land you in serious legal trouble. You may be perceived as being connected to an existing business when you are not. The existing business may take legal action against you for trademark infringement. You may be forced to change the name of your retail store, which will involve expensive rebranding. Additionally, you may also be liable for damages. Research the name you choose thoroughly and ensure that it is unique to your business. 

Choose the right legal structure for your retail store

The legal structure of your business is the next step to take and it’s a crucial one! The structure of your business will determine your tax rate, your liability and how you should keep your accounts. Depending on the type of structure you choose, you may have to register at Companies House or directly with HM Revenue and Customs (HMRC). 

The most common types of legal structures for retail stores are:

  • Sole proprietorships (sole traders) – This is when one person opens and runs a business on their own
  • Partnerships – Two or more people enter a legal contract as owners of a business.
  • Companies – A company is formed when it is registered as a legal entity.

Get your tax affairs sorted

Once you have registered your legal structure, you’ll need to make sure you are registered with HMRC for tax purposes. Businesses must be registered because they will need to pay tax on any profits. A retail store will also need to pay Class 2 and Class 4 national insurance (NI).  

You can register for tax online at the HMRC website. After you’ve signed up, you will be sent a Unique Taxpayer Reference (UTR). HMRC will also send you a letter within about two weeks with an activation code for your account. 

If your retail store is projected to make more than £85,000 per year, you will need to register for Value Added Tax (VAT). Again, this can be done online via HMRC. Since not all goods or services attract VAT, it is a good idea to go over VAT information carefully. 

Take out the right type of insurance

Small business owners need to protect themselves against unforeseen events. It’s a good idea to get adequate insurance right from the start for your retail store. If you have staff in your retail store, then you will need to take out employers’ liability insurance. This is mandatory for any business that has employees. 

There are a few other insurance options that are not a legal requirement but are prudent for small retailers. Public liability insurance will pay for any legal fees or damages if a person is injured in your store. Professional indemnity insurance will cover legal costs if a product you have sold causes harm outside of your business premises. If you are concerned about protecting your stock or your premises, you may wish to take out commercial property insurance.

Look into your lease agreement

If you are not purchasing premises outright, then you will need to sign a lease agreement. A commercial business lease differs from a normal residential lease. Make sure you thoroughly go over the fine details in any lease you sign. 

In general, a lease for a commercial building should include:

  • The current rental cost and an estimate of any increases
  • The duration of the lease
  • Information on how to break the lease (get-out clauses)
  • If a guarantee is needed
  • Details on how the lease will be concluded 

Ready to open your store?

Know your obligations as an employer

If you are planning on employing staff, you’ll need to register with HMRC as an employer. This process has to be completed within 4 weeks after you have employed your first staff member. When interviewing staff, retailers need to ensure that any prospective employee is entitled to work in the UK. Some businesses may require employees to undergo a DBS check. 

As an employer, retail store owners will also have to ensure they are paying at least the national minimum wage. All employees must be enrolled in pension schemes and be issued statements of employment. 

Any retail store with over five employees is required to have a written health and safety policy. This policy will need to include measures taken to ensure that the building is safe for staff and customers. It should also detail how employees can go about their duties in safety and outline emergency procedures. 

Other documentation that a retail store with employees may need include a privacy policy and a code of conduct. Drafting these documents and requiring staff to sign them can provide legal protection against complaints.

Keep an eye on your opening hours

Just because you own your own retail store doesn’t necessarily mean you can open whenever you like. The UK government has strict rules surrounding legal opening hours. What regulations concerning business hours apply to your shop will depend on its size. 

A shop that has a floor size of up to 280 m2 is classified as a ‘small shop’. If this is the case, you will not have any trading restrictions. If your retail store is larger than this, you’ll have to restrict your opening hours. Large retail stores must stay closed on Easter Sunday and Christmas Day. They are only able to be open on Sundays between 6 am and 10 pm and only for a period of six hours.  

Good to know: Retail sales in the UK are on the rise

The volume of retail sales in the UK has increased in recent months. Figures show that retail sales are now higher than they were pre-Covid19. ³

Find out about any applicable legislation 

Retail store owners have a range of legal obligations to their staff, to the public and to the government. Getting a good overview of what regulations and legislation are applicable to your store will help you to avoid legal difficulties. 

In general, retailers have a responsibility to make sure their staff are legally employed and treated fairly. Retailers must also ensure that the retail prices of all goods are clearly displayed. Products should not have misleading descriptions and must be safe and fit for purpose.  

Legislation relating to employing staff includes:

  • Health and Safety at Work Act 1974
  • Equal Pay Act 1970
  • Sex Discrimination Act 1975
  • Race Relations Act 1976
  • Employment Protection Act 1978

Legislation concerning consumers includes:

  • Sale and Supply of Goods Act 
  • Trade Description Act 
  • Consumer Credit Act
  • Data Protection Act/GDPR

Open your
store with

Ready to discuss your opening project?

Our experts share their expertise with you to help you launch your store in the best conditions.

Contact an expert

Mistakes to avoid when opening a retail store

Starting a retail business of any kind is a complicated process and can be stressful. If you don’t take the right steps, you could face financial penalties, higher rates of tax or even wind up in court. Avoiding problems means taking the time to follow the right legal steps

Common mistakes that new retail store owners make include:

  • Not registering as the right legal entity
  • Not looking into your lease
  • Not getting insurance
  • Failing to register for tax
  • Failing to register as an employer
  • Not creating health and safety policies
  • Failing to correctly vet potential employees
  • Not having a good understanding of relevant legislation

Are you on the right track to opening your store?

How can you be sure that you are doing everything the right way when opening your retail store? There are many ways that new retailers can make certain they are following all the relevant legal steps.  

A good way to be sure you are on the right track is to speak with other retailers in your area. Local business owners can let you know important details such as if there are any applicable council taxes.

Another option is to get advice from a professional. You can check your tax and business structure details by speaking with an accountant who specialises in small retail businesses. Asking for advice directly from HMRC can also help you to make the right decisions. A lawyer who deals with small business legislation can assist you in staying on the right side of the law. 


  • Will I need to register my retail store?

No matter how big or small your retail store is, you will need to register your business name and the legal structure. This can be done via HMRC or with Companies House. 

  • Does employer law apply to me?

UK laws surrounding the responsibilities of employers will apply if you have staff that are not direct family members. Retail stores with more than five staff members will need a formal health and safety policy.  

  • What hours can my retail store legally open?

This depends on the size of your premises. Small shops do not have to abide by trading restrictions. Larger retail stores must adhere to stricter trading hours. If the size of your floor space exceeds 280 m2, you will have restricted trading hours. 

  • Where can I find help with opening a retail store?

Speaking with local business owners or engaging the services of an accountant or lawyer can be beneficial. Assistance can also be obtained from HMRC. Anyone looking to open a small retail store in the UK can also get assistance from the team at Ankorstore. 

Open your
store with

Ready to discuss your opening project?

Our experts share their expertise with you to help you launch your store in the best conditions.

Contact an expert

Need more tips on running your shop? Check out more articles below: