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HR Consultancy Launch Programme · Stage 2 of 10
Money & Foundations
Put the money and the cover under the consultancy: a business account, the right insurance, your CIPD standing, and a bookkeeping habit.
How long
2–4 days (PII quotes and bank approval can take longer)
You’ll have
Bank account, insurance, CIPD standing and bookkeeping in place
Steps
4 steps
Resources
2 resources
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01 Step 01
Step 01
Open a business bank account
Separating business money from personal money is the base of clean bookkeeping, clean tax, and credible invoices.
Do it yourself
- Choose between a traditional bank and a fintech like Starling, Tide or Monzo Business, comparing fees, invoicing tools and accounting-software integrations.
- Have your incorporation details and ID ready to speed the approval.
- Turn on a savings pot or a second account, earmarked for tax.
Common mistake · Running everything through a personal account "for now", which fouls up your bookkeeping and looks unprofessional on invoices.
Time1–3 hrs (approval can take days) Cost£0–£10/mo (rough) DifficultyEasy -
02 Step 02
Step 02
Get professional indemnity insurance
HR advice can be the proximate cause of a tribunal claim, so this is the single most important protection the consultancy buys.
Do it yourself
- Get professional indemnity insurance. £1m of cover is the common minimum; larger clients may contractually require £2m–£5m. A broker sets the right level, so get quotes.
- Add public liability for on-site visits, and consider cyber cover given the sensitive data you hold.
- Disclose your actual services honestly, especially higher-risk lines like investigations, dismissals and tribunal representation, because non-disclosure can void a claim.
- Understand the exposure: unfair-dismissal awards run to tens of thousands and discrimination awards are uncapped, and if your advice drove the decision you are on the hook.
Common mistake · Buying the cheapest headline policy without disclosing tribunal-representation or investigation work, leaving a gap exactly where the risk is.
Time2–4 hrs CostEntry ~£6–£10/mo low-risk; a working consultancy more like £750–£2,500/yr (rough market figures; get quotes) DifficultyMediumResource for this step
CHECKLISTPII cover and disclosure checklist
A rough guide to cover levels and what to tell your insurer, so the policy pays when you need it. Not insurance advice; a broker sets the right level, so get quotes.
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03 Step 03
Step 03
Sort your CIPD membership standing
CIPD is voluntary and not a licence to practise, but the right level is a strong credibility signal to SME clients and referral partners.
Do it yourself
- Confirm the framing: anyone can call themselves an HR consultant. CIPD adds credibility, CPD structure and resources, not legal permission.
- Pick or confirm your level: Foundation, Associate (Assoc CIPD), Chartered Member (Chartered MCIPD) or Chartered Fellow (Chartered FCIPD), earned through qualification plus experience assessment.
- Mind the protected-title point: the "Chartered" titles sit on the Regulated Professions Register, so only use Chartered MCIPD or FCIPD if you hold it. That regulates the title, not the practice of HR.
- Budget the annual CPD obligation for members, which requires record-keeping.
Common mistake · Implying CIPD membership is a required licence, or overstating the level you hold.
Time1–2 hrs (assessment longer) Cost2025/26 annual fees incl. £40 joining fee: Foundation £163, Associate £244, Chartered Member £244, Chartered Fellow £365 (verify current) DifficultyEasy -
04 Step 04
Step 04
Set up bookkeeping and tax set-aside
A consultancy with no bookkeeping habit hits a cash-flow wall at the first tax bill.
Do it yourself
- Choose accounting software like Xero, QuickBooks or FreeAgent, or bring in an accountant.
- Set a tax and NI set-aside rule: a fixed % of every invoice moved into a separate tax pot.
- Note the VAT registration threshold and put a review trigger in your calendar. HMRC sets your position, so treat this as a signpost.
- Decide your standard invoicing terms, for example 14 or 30 days, which you will reuse in Module 10.
Common mistake · Spending the VAT and tax money because it is sitting in the current account.
Time2–3 hrs Cost~£10–£30/mo software (rough) DifficultyEasyResource for this step
PDFTax set-aside worksheet
Turn each invoice into a set-aside for tax and the net you can actually spend, and diarise a VAT-threshold review. Not tax advice; HMRC sets your position, so confirm it with them or an accountant.
What you’ll have after this stage
- A business bank account in the consultancy’s name, with a tax pot alongside it
- Professional indemnity cover arranged through a broker, with public liability considered
- Your CIPD standing confirmed at the level you actually hold
- Bookkeeping set up, with a fixed slice of every invoice going to tax
- A VAT-threshold review sitting in your calendar