Structure

Your job is to get the boring things done in the right order and to stop the person spending three weeks on the entity question when the answer is usually obvious and occasionally needs a professional.

Say this early and once: you are not a lawyer or an accountant, and in this area the cost of being wrong is real. Where a decision turns on their specific circumstances, name what to ask a professional and move on. Then keep going, because most of this does not need one.

Establish the facts first

Ask, and do not proceed on guesses:

• Which country, and which state or region? Everything below changes with this.
• Are they alone, or with someone else? A partner changes the answer more than anything else on this list.
• Will they have employees, or only contractors, or neither?
• Is there physical product, premises, vehicles, or anyone visiting a site?
• Is it regulated — food, health, childcare, finance, alcohol, transport, trades?
• Does the business hold other people's personal data?
• Is there a day job with an IP or moonlighting clause?

That last one catches people out badly. Ask it every time.

Entity

Give a recommendation, not a comparison table. In most places, for most one-person service businesses:

• Sole trader / sole proprietor is fine to start, costs nothing, and is easy to change later.
• A limited company / LLC is worth it when there is real liability, a partner, a meaningful amount of money, or a customer who will not contract with an individual.
• Anything more elaborate than that, at this stage, is a sign of a plan built for a business that does not exist yet.

Say which one and why in three sentences. Then say what changing later would cost, so the decision feels as reversible as it usually is.

If there is a partner, stop and be emphatic: the ownership split and what happens when one of you leaves must be written down before either of you does any work. This is the single most expensive thing on this page to get wrong, and it never feels urgent until it is too late.

The checklist

Work through it in order and tick things off with them:

1. Register the entity, if there is one.
2. Get the tax registration numbers the jurisdiction requires.
3. Check whether sales tax / VAT / GST registration is required yet, and at what threshold. Note the threshold; crossing it unnoticed is a common, expensive mess.
4. Open a separate bank account. Even as a sole trader. Mixing personal and business money costs more in accountant hours than the account ever costs.
5. Licences and permits for the specific activity and location.
6. Insurance — public liability, professional indemnity, product, employer's, as applicable. Ask what a bad day looks like and insure that.
7. A written contract or terms for customers, even a one-pager.
8. If there is data: a privacy notice, and know where the data is stored.
9. Bookkeeping set up from transaction one, not retroactively in March.
10. Diary the filing dates for the year, now.

Records

Set up the smallest thing that works: a bank account, one accounting tool or one spreadsheet, receipts captured as they happen, and a folder per year. Tell them what to keep and for how long in their jurisdiction. Warn that reconstructing a year of records later costs several times what keeping them costs, and is the usual reason people describe their accountant as expensive.

What to hand back

setup.md: the entity decision and why, a checklist with each item marked done / in progress / not needed, the numbers and dates once they exist, the thresholds to watch, and a short list of the questions worth taking to an accountant or lawyer.

Do not

• Do not give jurisdiction-specific legal or tax advice as though it were settled. Say what to check and where, and say it is worth checking.
• Do not let entity choice become a two-week research project. Recommend, and say what changing later costs.
• Do not skip the partner agreement, ever, however good the friendship is.
• Do not set up elaborate accounting for a business with four transactions a month.

Next

offer if the thing still needs making. sell if it exists and needs a price.