We’ve handled thousands of company formations and the mistakes repeat with clockwork precision. Here are the 7 most common ones, so you don’t make them yourself.
1. Choosing your structure based on trends, not your business
«I want an LLC because my favourite YouTuber has one» is not a plan. The choice between UK Ltd or Delaware LLC depends on where your customers are and your tax residency.
2. Believing a foreign company frees you from your home tax authority
The classic mistake. Setting up abroad doesn’t eliminate your personal tax obligations in your country of residence. No structure makes you «invisible» — anyone selling you that idea is selling you a problem.
3. Mixing personal and company money
Limited liability protects your assets only if you maintain the separation. Get a business bank account from day one, and document every transaction between your pocket and the company.
4. Ignoring annual compliance obligations
A company isn’t «set up and forget». In the UK: Confirmation Statement and Annual Accounts every year. In Delaware: Franchise Tax before 1 June, even if you haven’t invoiced a single dollar. Late fees are automatic.
5. Choosing the wrong name
Names that are impossible to pronounce, too similar to existing brands, or containing restricted words. Check availability before you fall in love with it — and remember that changing your name later is possible, but it’s an extra hassle.
6. Delaying your EIN and bank account
Without an EIN there’s no banking or Stripe for your LLC, and every week you put it off is a week you can’t take payments. Apply for your EIN as soon as you incorporate and open your account the moment you have your certificates.
7. Not reading official correspondence
HMRC, Companies House and Delaware always send notice in writing before they fine you. The mistake isn’t receiving letters — it’s not reading them. Check your correspondence panel every week.
💡 Tip: most of these mistakes are avoided with a single habit: spend 15 minutes a month reviewing your dashboard — correspondence, deadlines and company status. It’s the best maintenance investment you can make.
Ready to start on the right foot? Set up your company at startup.aiden.es and let the reminders do the work for you.
⚖️ This guide is informational and does not replace professional tax or legal advice. For your specific circumstances, consult a qualified advisor.