6. Go Paperless
Paper, ink, envelopes, printer maintenance, postage it all adds up. Transitioning to a paperless office not only reduces your day-to-day business expenses, but also saves time, improves document security, and supports environmental goals.
While going 100% paper-free may not be realistic for every business, even partial shifts to digital processes can significantly cut costs and admin.
Key Cost-Saving Areas:
- Invoicing and billing
Switch to digital invoicing platforms like QuickBooks, Zoho Books, or FreeAgent. You’ll save on paper and postage, and get paid faster. - Contracts and signatures
Use e-signature tools like DocuSign, Adobe Acrobat Sign, or HelloSign to send, sign and store contracts securely. - Document sharing and archiving
Instead of printing and filing, use Google Drive, Dropbox, or OneDrive to store and organise business documents in the cloud. - Internal communications and HR
Replace paper memos, forms and timesheets with digital HR tools like Breathe HR (UK-based) or CharlieHR. - Receipts and expenses
Use mobile scanning apps (e.g. AutoEntry, Dext, or Expensify) to digitise and categorise expense receipts no more shoeboxes of faded till slips.
HMRC accepts digital records for tax purposes
Environmental Benefits
Going paperless aligns with growing sustainability goals and can support green marketing. Clients are increasingly conscious of eco-practices, so reducing paper use may also strengthen your brand perception.
Tips to Go Paperless Smoothly:
- Set a clear internal policy – e.g. “no internal printing unless essential”
- Move to cloud-based project management tools (e.g. Trello, Notion)
- Use dual monitors or split-screen views to reduce the need to print for reference
- Digitally archive old files using a scanner and shredder
Tip: Audit your monthly printing spend including paper, ink, envelopes and postage. Even small teams often spend £500–£1,000 per year on printing-related supplies that could be reduced or eliminated.
7. Buy Second-Hand Equipment
Furnishing an office or upgrading tech doesn’t have to break the bank. By buying second-hand or refurbished business equipment, UK small businesses can save 30% to 80% compared to retail prices all while promoting sustainability and reducing waste.
Whether you need furniture, laptops, printers, or point-of-sale systems, there are excellent quality pre-owned options available.
What You Can Buy Used (and Save On):
- Office furniture: desks, chairs, filing cabinets, monitor arms, meeting tables
- Tech equipment: laptops, monitors, keyboards, routers, printers
- Retail/restaurant kit: shelving units, tills, fridges, display counters
- Miscellaneous: shredders, whiteboards, packaging supplies, storage containers
Where to Buy Second-Hand or Refurbished in the UK:
- Gumtree Business – local listings for furniture, tech and tools
- Facebook Marketplace – ideal for quick pick-up of office furniture and bulk items
- British Heart Foundation Furniture & Electrical Stores – affordable business-appropriate furniture
- eBay Business & Industrial – refurbished and liquidation stock
- com – UK supplier of professionally refurbished IT equipment
- CPC and Techbuyer – for B2B refurbished electronics and components
- Auction Houses like John Pye or i-bidder – office and commercial clearance sales
What to Watch Out For:
- Warranties: Many refurbished IT sellers offer 6–12 month warranties. Check before purchasing.
- Condition grading: Especially on laptops – Grade A usually means minimal wear.
- Scams: Always use trusted payment methods and buy from reputable sellers.
- Check VAT treatment: Some second-hand goods may be sold under the VAT margin scheme, which affects reclaim options for VAT-registered businesses.
Tips for Success:
- Set alerts on eBay or Facebook Marketplace for specific items
- Contact local businesses closing down — many will sell off furniture and gear cheaply
- Buy in batches to negotiate better deals (especially with auction houses or clearances)
Tip: When kitting out your workspace, prioritise ergonomics (like adjustable chairs and screens). Buying used ergonomic furniture gives you comfort and posture support at a fraction of the usual cost — and can reduce sick days caused by strain or injury.
8. Use Energy More Efficiently
Energy bills are a major overhead for many small businesses whether you run a home-based consultancy or a high-street premises. Fortunately, small changes in how you use electricity, heating and appliances can lead to surprising long-term savings.
Improving energy efficiency is also good for your environmental credentials which is increasingly important to customers, funders and suppliers.
Quick Wins for Small Businesses:
- Switch to LED lighting
LEDs use up to 80% less energy than traditional bulbs and last significantly longer. Swapping out halogens and CFLs can cut your lighting bill substantially. - Use smart thermostats and timers
Smart devices like Hive or Nest can regulate heating more efficiently keeping you warm when needed but avoiding waste when your business is closed. - Unplug or shut down unused devices
Computers, monitors, printers and routers still use power in standby mode. Encourage staff to fully shut down equipment at day’s end. - Install motion sensors in low-use areas
Great for storerooms, bathrooms or corridors. Lights only come on when needed. - Switch to energy-efficient appliances
When upgrading fridges, kettles or office equipment, look for A++ or Energy Star-rated models. - Draught-proof your workspace
In physical offices, sealing windows, doors and pipe gaps can reduce heat loss and cut heating bills.
Useful Tools and Grants:
Measuring and Monitoring Usage:
Installing a smart meter can give real-time insights into when and where your business consumes the most energy. Some suppliers offer this free to small businesses.
Use data to adjust your habits, identify ‘always on’ devices, or spot times where energy use spikes unnecessarily.
Tip: Set up a monthly energy tracker in your accounting software or spreadsheet monitoring usage against revenue. Even a 10% reduction in usage can lead to hundreds of pounds saved annually, especially in energy-intensive sectors like retail, hospitality or manufacturing.
9. Work Remotely or Downsize Office Space
Renting and maintaining a physical workspace is often one of the largest fixed costs for small businesses. Embracing remote or hybrid working models even partially can lead to substantial savings on rent, utilities, maintenance, and day-to-day overheads.
Whether you’re a startup, freelancer, or micro-business, downsizing your workspace or going fully remote may be one of the quickest ways to boost profitability without cutting staff or services.
Financial Benefits of Remote or Hybrid Work:
- Lower rent or no rent at all
Switching from an office lease to a home-working model can save hundreds or even thousands of pounds each month. - Reduced utility bills
No heating, lighting, or water bills for unused spaces. - Fewer cleaning and maintenance costs
Less wear and tear, fewer site responsibilities. - Lower commuting and travel reimbursements
Staff working from home reduce fuel claims and public transport costs.
Practical Alternatives to Traditional Offices:
- Coworking spaces
Use pay-as-you-go or flexible memberships from spaces like: - Regus
- WeWork
- Spaces
- Impact Hub
These can offer hot desks, meeting rooms, and professional addresses without the cost of a full-time lease.
- Home office set-ups
A well-equipped spare room or garden studio can often replace an office for sole traders or micro-teams. You can also claim part of your home running costs as allowable business expenses.
Claiming home office costs – GOV.UK
Hybrid Models That Work:
Not all businesses can go fully remote but many can benefit from hybrid arrangements:
- Rotate team members across 2–3 shared desks instead of maintaining a desk per person
- Use virtual meeting tools (Zoom, Teams, Google Meet) instead of in-person catch-ups
- Have physical meetups monthly rather than weekly
Tips to Transition Smoothly:
- Invest in good remote collaboration tools (Slack, Microsoft 365, Google Workspace)
- Set expectations around working hours, communication and availability
- Test a 3–6 month trial period before fully ending your office lease
- Use a virtual registered office address to maintain professionalism if using home addresses
Tip: If you’re still tied to a physical lease, consider subletting unused office space to freelancers or small businesses. This can turn unused desks or rooms into revenue while keeping your existing premises.
10. Switch to a Better Business Bank Account
Not all business bank accounts are created equal. Many small businesses end up paying high monthly fees, unnecessary transaction charges, or suffer from clunky interfaces that don’t integrate with their accounting tools.
By switching to a more modern or tailored provider, you could save money, simplify bookkeeping, and even earn perks like cashback or partner discounts.
Key Features to Look For:
- Low or no monthly fees
Especially if you’re a sole trader or a small limited company with light transaction volume. - Free UK bank transfers and card payments
Avoid per-transaction charges wherever possible. - Easy integration with accounting software
Look for direct links to QuickBooks, Xero, FreeAgent, or Zoho Books. - Fast setup and mobile-first design
Modern challenger banks often offer same-day account setup and full mobile control. - Perks and benefits
Some accounts include partner discounts, invoice generation, or cashback on purchases.
Top Business Bank Accounts for UK SMEs (2025):
| Bank | Key Features |
| Starling Bank | No monthly fees, FSCS protection, Xero/QuickBooks integration |
| Tide | Easy setup, expense tracking, integrated invoicing |
| Revolut Business | Multi-currency, analytics, expense cards, free and paid plans |
| Monzo Business | Great mobile app, pots for budgeting, integrated tax estimates |
| Cashplus Bank | Credit builder tools, FSCS protection, basic free plan available |
| HSBC Kinetic | App-based account with business insights and overdraft options |
Compare business accounts – MoneySavingExpert
Tips to Maximise Savings:
- Switch regularly – Loyalty rarely pays. Check your bank’s fees annually and compare options.
- Automate accounting – Choose a bank that exports transactions directly to your accounting tool.
- Use multiple accounts if needed – For example, keep a separate tax pot or use a prepaid card (like Soldo or Pleo) for staff spending controls.
- Check eligibility for startup offers – Some banks offer £50–£100 welcome bonuses, or free banking for 12–18 months.
Tip: Set up automated “sweep rules” from your main account into a tax savings pot or emergency fund each month. Apps like Starling and Monzo make this easy and it keeps you financially disciplined.
11. Use VAT Schemes to Your Advantage
VAT can be a headache for small businesses, especially when it comes to cash flow and admin. But HMRC offers several alternative VAT accounting schemes that can simplify your processes and even help you keep more money in the business particularly if your turnover is under £1.35 million (excl. VAT).
Choosing the right scheme could reduce your VAT bill, improve predictability, and ease administrative stress.
Key VAT Schemes for UK Small Businesses:
1. Flat Rate VAT Scheme (FRS)
Under this scheme, you pay a fixed percentage of your gross turnover to HMRC but you do not reclaim VAT on most purchases. The percentage you pay depends on your industry type.
Good for:
- Service-based businesses with few VATable costs (e.g. consultants, designers, IT contractors)
Perks:
- Simpler record-keeping
- Potential savings if your actual VAT costs are low
- A 1% discount in your first year of VAT registration
Example:
If you’re a freelance copywriter with VATable turnover of £30,000 and a flat rate of 12%, you’d pay £3,600 to HMRC even if you collected £6,000 in VAT from clients. If your expenses are minimal, the difference is profit.
Flat Rate VAT Scheme – GOV.UK
2. Annual Accounting Scheme
With this scheme, you make advance VAT payments based on your previous year’s return (or an estimate if you’re new), and submit just one return per year.
Good for:
- Businesses that want more predictable cash flow
- Reducing quarterly admin pressure
Threshold:
- Available if your VAT taxable turnover is under £1.35 million
VAT Annual Accounting Scheme – GOV.UK
3. Cash Accounting Scheme
With the cash accounting scheme, you only pay VAT when your customers pay you and reclaim VAT when you pay your suppliers.
Good for:
- Businesses with slow-paying clients
- Improving cash flow
- Avoiding paying VAT on unpaid invoices
Eligibility:
- VAT turnover must be under £1.35 million
VAT Cash Accounting Scheme — GOV.UK
How to Choose the Right Scheme:
| Your Situation | Best Scheme |
| Low VAT expenses, high service income | Flat Rate |
| Want easier admin & fewer returns | Annual Accounting |
| Clients pay slowly, cash flow is tight | Cash Accounting |
Tips to Maximise VAT Efficiency:
- Review your eligibility each year as your turnover or business model changes, so should your VAT approach.
- Use software that supports your chosen scheme (e.g. Xero, QuickBooks, or FreeAgent).
- Watch out for limitations some schemes restrict when you can reclaim input VAT.
Tip: Even if you’re not VAT registered yet, keep good digital records so you’re ready to register as soon as you cross the threshold or sooner, if using FRS makes financial sense for your sector.
12. Automate Where Possible
Time is one of your most valuable business assets and repetitive admin is one of the quickest ways to lose it. By automating common tasks, you can free up hours each week, reduce errors, and focus on growth-driving work instead.
Even modest automation can save a small business thousands of pounds annually in reduced admin, improved response times, and lower payroll or outsourcing costs.
What Can You Automate in a Small Business?
Here are common business processes UK startups and SMEs can automate easily:
Invoicing and Reminders
- Automatically send invoices after a sale or service
- Send follow-up reminders for unpaid invoices after 7, 14, or 30 days
- Reconcile payments directly with your bank feed
Tools:
Social Media Scheduling
- Pre-schedule weeks’ worth of posts across platforms
- Use AI-generated captions or repurpose blog content
- Monitor engagement from one dashboard
Tools:
Customer Follow-ups
- Thank-you emails
- Review or testimonial requests
- Follow-up sales messages or re-engagement sequences
Tools:
Bookkeeping and Expense Categorisation
- Auto-tag recurring expenses
- Match transactions to invoices or suppliers
- Scan and attach receipts with your phone
Tools:
Workflow Automation (for everything else)
- Trigger actions across platforms (e.g. send a Slack message when a new form is submitted)
- Connect your CRM, Google Sheets, website, email, and calendar together
Tools:
Tip: Start by identifying your most repetitive weekly task. Ask: Can this be templated, scheduled or triggered automatically? Small changes (like auto-sending invoice reminders) can deliver huge time savings over a year.
13. Take Advantage of Tax Reliefs
Tax reliefs aren’t just for big corporations the UK offers a range of generous tax relief schemes specifically designed to support startups, micro-businesses and SMEs. If you’re not using them, you could be leaving thousands of pounds in savings on the table each year.
Here are three of the most valuable schemes to explore:
Annual Investment Allowance (AIA)
The AIA lets you deduct the full cost of qualifying business equipment and machinery from your profits before tax — up to a generous limit of £1 million per year.
Examples of what you can claim:
- Office furniture
- Laptops and work computers
- Manufacturing equipment
- Business vehicles (excluding cars)
Tip: Time your capital purchases at year-end to maximise allowable deductions.
AIA guide – GOV.UK
Research & Development (R&D) Tax Credits
This scheme rewards businesses that spend money developing new products, processes, services or improving existing ones. If eligible, you can claim a cash rebate or enhanced tax deduction of up to 27% of qualifying R&D costs.
Common R&D activities:
- Developing custom software
- Prototyping new hardware or devices
- Experimenting with improved manufacturing processes
- Overcoming scientific or technological challenges
Tip: You do not need to wear a lab coat many tech, food, and engineering SMEs qualify.
R&D Tax Credits – GOV.UK
Employment Allowance
If you employ staff, this allowance lets you reduce your employer’s National Insurance bill by up to £5,000 per tax year.
Eligibility:
- You must have at least one employee earning above the Class 1 NI threshold
- Your total Class 1 NI liability in the previous tax year must be under £100,000
Tip: Many small business owners forget to apply it’s claimed via your payroll software or through HMRC’s Basic PAYE Tools.
Other Reliefs Worth Exploring:
- Seed Enterprise Investment Scheme (SEIS) – for raising funding with tax incentives for investors
- Business Rates Relief – especially small business or rural rate relief if you operate from premises
- Patent Box – for businesses that earn income from patented inventions
- Creative Industry Tax Reliefs – for businesses in animation, film, TV, or video games
Tip: Keep a recurring reminder every tax quarter to review eligibility for reliefs or speak to your accountant about underused schemes. Proactive planning = long-term savings.
Complete list of business tax reliefs – GOV.UK
14. Review Insurance Policies Annually
Business insurance is essential for protection but premiums can quietly increase year-on-year without you noticing. If you simply auto-renew every 12 months, you could be overpaying by 20–40% or more.
Whether you’re a sole trader, contractor or limited company, taking the time to review your insurance annually can free up hundreds of pounds and help ensure your cover still matches your needs.
Types of Insurance Small Businesses Often Need:
- Public liability insurance
Covers injury or damage to third parties (clients, delivery drivers, etc.) - Professional indemnity insurance
Covers legal costs and compensation if your advice or work causes a client loss - Employers’ liability insurance
A legal requirement if you employ staff, even part-time or remote - Business contents/equipment insurance
Covers office kit, laptops, stock or tools against damage or theft - Cyber insurance
Increasingly vital it protects against data breaches, ransomware and IT downtime
Why You Should Review Annually:
- Your turnover or staffing may have changed affecting your premium
- You may now qualify for bundled cover or a specialist policy
- You might be paying for cover you no longer need, such as for equipment you’ve sold or vehicles no longer in use
- Market competition may have driven down premiums but your insurer won’t tell you
Where to Compare Business Insurance in the UK:
- Simply Business – tailored for sole traders, freelancers and microbusinesses
- Quotezone – compares from over 40 UK providers
- PolicyBee – popular with consultants, creatives and tech startups
- AXA UK – direct for packaged cover
- Checkatrade Insurance – geared towards tradespeople
Money-Saving Tips:
- Use a specialist broker especially if you’re in a niche or regulated sector (e.g. food production, healthcare, or finance)
- Negotiate at renewal insurers will often match or beat a better quote if you ask
- Consider raising your excess to reduce premiums, but only if you can afford to cover it
- Pay annually, not monthly if cash flow allows, annual payments avoid monthly interest
Tip: Keep a spreadsheet or Notion doc listing all your business insurance policies, start/end dates, and renewal windows. Set a calendar alert 4 weeks before each renewal to review or compare not after the auto-renewal kicks in.
GOV.UK guide: Business insurance – what you need
15. Join Local and Industry Networks
Joining a local business network, trade association, or industry group isn’t just about networking it’s often a cost-saving strategy in disguise. These organisations frequently provide members with access to exclusive discounts, free training, legal templates, and low-cost marketing opportunities.
If you’re not part of one, you could be missing out on benefits worth hundreds or even thousands of pounds annually.
Real Money-Saving Benefits of Membership:
- Discounted training and CPD
Many offer free or low-cost webinars, workshops, or accredited courses which can save £50–£500+ compared to external providers. - Legal templates and advice
Access to contracts, HR policies, and business documents without having to hire a solicitor. - Insurance and finance deals
Partner offers often include reduced rates on public liability insurance, card processing, or business loans. - Free or discounted events and expos
Attend industry expos, supplier meetups, or B2B pitch events at little or no cost. - Marketing support
Some networks promote their members via directories, newsletters, or joint PR campaigns essentially free exposure.
Examples of UK-Based Business Networks:
| Network / Association | Focus Area | Benefits |
| FSB – Federation of Small Businesses | General SME support | Legal helpline, discounts, events, lobbying, insurance perks |
| Chambers of Commerce (BCC) | Local business community | Networking, exporting support, training, member directories |
| Enterprise Nation | Startups and microbusinesses | Webinars, funding advice, partner discounts, marketing promotion |
| IPSE | Freelancers and contractors | Tax support, contract templates, legal cover, pensions guidance |
| Creative UK | Creative industries | Funding alerts, community events, job boards, peer support |
| Tech Nation Rising Stars Alumni | Tech startups | Grants, talent resources, international growth programmes |
Free Local Networking Ideas:
- Google – Search for free business and industry events in your area
- Facebook business groups – Join regional or niche groups for B2B referrals and advice
- Local growth hubs – Regional LEPs often run free training and grants (Find your local LEP)
- Council-backed business centres – Many UK councils fund low-cost co-working, incubators, or peer mentorship schemes
Tip: Before joining, ask for a free trial or one-month guest pass most networks will let you sample their benefits, events, or online community before you commit.
Also check if they offer discounted membership for early-stage businesses (e.g. under 12 months trading).
Final Thoughts on saving money in your business.
Smart savings are not always about big cuts small efficiencies and ongoing reviews can add up to major benefits. Start with one or two of these tips today to reduce waste and improve your financial resilience.
Want support managing your startup costs or improving cash flow? Formations Wise can help you build a leaner, smarter business from day one.
