Making the decision to set up your recruitment agency is the beginning of an exciting journey. 

To help you get up and running, we’ve outlined everything you need to do set to set up your recruitment agency in 5 easy steps. We can’t help you choose the perfect name; however, we can show you the fastest way to register your company and cut down the amount of research and planning you need to do. 

Setting up your recruitment agency involves a series of processes starting from determining your niche, assessing your finances, and researching the right rules and regulations to identifying and setting business goals. Whilst you explore this blog on setting up your recruitment agency,  

In this blog, we’ll cover key aspects that you must consider before setting up your recruitment agency in the UK.  

Some of the key points to consider are- 

  • Choosing a name for your recruitment agency 
  • Key considerations to register your recruitment agency with Companies House 
  • Key infrastructure and legal requirements you need to know and setup 
  • Overview to branding your recruitment agency – from creating your brand to setting up a website and social media 
  • Planning, budgeting and setting your year one plan 

Whilst setting up your recruitment agency, if you require support in terms of funding, back-office work or timesheets, Sonovate has got you covered. Get Started to scale your recruitment agency with smart tech and funding solutions. 

Get Started 

Have a look at the 5 important steps to set up your recruitment agency.  

#1 Choosing a name for your recruitment agency 

Seemingly a simple task, coming up with a name for your recruitment agency can prove trickier than expected. Before you deliberate over the perfect name, here are some branding pointers and a few legal parameters that you need to adhere to: 

Keep it legal – There are several rules governing what can and cannot be used, make sure you check the full list here. 

Check availability – Check that nobody has already registered the business names you have in mind – this can be done quickly and easily on the Companies House website. 

First impressions count – Your business name will be the first impression your contacts have with your recruitment agency, so it is important to convey the right message. Think about your brand and the market you’re targeting (professional, easy-going, fun, etc.) and work around it. 

Consider the future – Your future is well worth considering before choosing a business name. The wrong name could potentially cause headaches when expanding. (i.e.: difficult to branch into education when called ‘Oil & Gas Recruitment’). Also, keep in mind that your name needs to translate well in any country you are looking to enter. 

Here’s a quick guide packed with expert advice to set up your recruitment agency.  

#2 Register Your Recruitment Agency with Companies House 

Registering your company is an important milestone in the process to set up your recruitment agency. It sounds scary but it’s the easiest and quickest process in the world – a maximum of 15 minutes! 

Before you start, we recommend that you have some information ready, so that you can get through the process more quickly. 

Make sure you have: 

  • Company name and UK office address 
  • New director’s name, address, nationality, date of birth and business occupation 
  • Share capital details 
  • Subscriber details and address 
  • Currency and number of stocks/shares held 
  • Preferred form of payment – the fee is £12 to complete the registration 

#3 Establish your agency’s infrastructure  

There are many things you need to be aware of and action before you can start trading, including: 

  • Business bank account 
  • Accounting 
  • Legal Requirements 
  • Business Insurance 
  • Terms and conditions and contracts 

We’ve covered all the above in more depth in our expert eBook. Below is a brief summary of the key topics you need to be aware of. 


Hiring an accountant at different stages of your company’s growth, whether full-time, retainer or project-based will make life a lot easier. Support can include: 

  • Business plan and legal structure 
  • Interim reviews (monthly, quarterly) 
  • Annual tax return 
  • Growth milestones £x turnover, headcount 
  • Expansion and acquisitions 
  • Tax planning 
  • Exit and business sale 
  • Management accounts, P&L, Cash flow 

Recruitment agency business Insurance 

If you’re placing contractors, it’s essential that your agency has the same insurance as the contractors themselves so that liability can be passed down the line. Policies you should evaluate: 

  • Professional Indemnity insurance 
  • Public Liability insurance 
  • Employers’ Liability insurance 
  • Cyber and data risks insurance 

Terms and conditions 

Creating your T&Cs is an important step in the process – without them, you risk non-payment and liability issues.  

Best practice includes: 

  • Seek professional advice to create your T&Cs.  
  • Have separate T&Cs for contract and permanent placements. 
  • Get the T&Cs signed and dated by the client before you begin to perform the contract. This removes arguments about whether the contract is legally enforceable. 

Legal Requirements 

  • HMRC: The Income Tax (Pay As You Earn) (Amendment No. 2) Regulations 2015 
  • Data Protection Act 
  • Agency Worker Regulations (AWR) 
  • UK Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing (CAP Code) 
  • Equality Act 2010 
  • IR35

#4: Get your website online 

The very first thing to consider is which platform you are going to use. You can use a drag-and-drop platform like Wix that are really easy to use (you don’t need to know how to code), but that might limit you in terms of customisation in the long run, or you can opt for platforms like WordPress or SquareSpace that might be a bit harder to get the hang of at first, but that will allow you to be very flexible as your recruitment agency grows.

Top tips: 

  • Make sure your Calls to Action are obvious – If your CTA is for the users to contact you, make that obvious in your content and clearly label the CTA. 
  • How do people get in touch? Ensure your contact details are easy to find and your phone number is visible on each page. 
  • Make sure that you set your website address to auto-renew! See example here 

Things to consider: 

  • Write SEO-optimised content  
  • Social media – Keep this strategy very simple. Be where your candidates and clients are! If your candidates are active on LinkedIn, that’s where you need to be seen. You run the risk of spreading yourself too thin and not achieving your targets.

Your guide for a flawless start!

Do you want more tips on how to successfully set up your own recruitment agency? Download our guide to setting up to get the full insight!

#5: Planning, budgeting and setting your year one objectives 

Free recruitment agency business plan and budget templates

Go ahead! Download our business plan and budget templates. These are complete, professional and completely free!

We’ve collated a list of some of the events happening across the country (even a few abroad) that may be of interest to you. 

Setting year one objectives 

To set your year one objectives, break the actions into areas targets: 

  • Sales target 
  • Personal Target 
  • Perm/contract deals 
  • Average fee/margin 
  • Client/candidate referrals 
  • Hires 
  • Key clients won/retained 
  • Account penetration 
  • Perm/contract ratio 
  • Exclusive / retained assignments 

And then break down the targets into quarterly and monthly actions, monitoring key metrics that impact and influence target completion. 

  • Application completion rate 
  • Candidate call-back rate 
  • Candidates per hire 
  • Cost per hire 
  • Fill rate 
  • Retention rate 
  • Sourcing channel effectiveness 
  • Time to hire 

Our platform 

Sonovate is an invoicing platform designed to reduce admin, save time, and let you focus on growing your recruitment business. Choose from a funding and back-office platform for an all-in-one solution, or just funding to complement existing systems. Giving flexibility at times you need it, or growth engines when the time is right. 

Book a short demo with our team at a time that suits you to find out how Sonovate can help your business grow.