How to start a small domestic building firm

Homeowners planning extensions, loft conversions and major renovations, plus small landlords and local businesses.

Fixed-price quotes or day rates for labour plus materials. Stage payments help cash flow. Margin comes from your own labour and a mark-up on materials and subcontractors.

• Building trade skills such as bricklaying, carpentry or general building
• Estimating labour and materials
• Leading a small team
• Keeping to health and safety on site

• Public liability, contract works and employer's liability insurance once you take on staff
• Building Regulations sign-off and planning permission, check who applies and who pays on each job
• CDM 2015 duties, site safety, working at height and asbestos risks in older properties
• CIS registration and VAT rules, including the domestic reverse charge
• Waste carrying: check whether you need to be a registered waste carrier
• Rising material prices and delayed payments can squeeze your cash, so agree stage payments in writing
• Physical work with long days, plan for injury and downtime

Startup costs are typically around £5,000 to £25,000, depending on your tools, vehicle and team. These are estimates, so allow a buffer for materials and cash flow, especially while you wait for stage payments.

Monthly revenue is typically around £4,000 to £20,000, depending on the jobs you win and the size of your team. This is revenue, not profit, so materials, labour and insurance costs all come out of it.

Check your insurance (public liability, contract works, and employer's liability if you take on staff), Building Regulations sign-off and planning permission on each job, CDM 2015 duties, CIS and VAT rules including the domestic reverse charge, and whether you need to be a registered waste carrier.