Starting a Catering Business in the UK: Costs, Licences & Software

What you need before you cook for money

Starting a catering business in the UK requires registering with your local authority, meeting food hygiene requirements, and getting the right insurance. Here is what you need and roughly what it costs.

1. Register as a food business

You must register with your local authority at least 28 days before you start trading. Registration is free and applies whether you are cooking from home, a rented kitchen, or a mobile unit.

Register via your local council's website or through GOV.UK's food business registration page.

2. Food hygiene training

There is no legal requirement to hold a specific food hygiene certificate, but the Food Standards Agency expects food handlers to be trained in food hygiene proportionate to their work. In practice, most clients, venues, and market organisers require at least a Level 2 Food Hygiene certificate.

Certificate	Cost	Duration	Notes
Level 2 Food Hygiene	£20-80	1-2 hours (online)	Minimum expected standard
Level 3 Food Hygiene (Supervising)	£100-200	2-3 days (in-person or online)	Recommended for running your own business

Level 3 demonstrates a higher level of knowledge and can be a differentiator when quoting for corporate or high-end private events.

3. Insurance

Public liability insurance is essential. Product liability insurance covers you if someone becomes ill from your food. Professional indemnity covers advice you give (menu planning, allergen guidance).

Insurance type	Typical annual cost	Why you need it
Public liability (£1-5M cover)	£80-200	Covers injury or damage at events
Product liability	£100-250	Covers illness caused by your food
Employers' liability (if you have staff)	£100-300	Legal requirement if employing anyone
Equipment cover	£50-150	Covers theft or damage to your kit

Many insurers offer combined catering insurance packages at £200-400/year.

4. Business structure

Most UK caterers start as sole traders. It is the simplest structure: register with HMRC for Self Assessment, keep records of income and expenses, and file a tax return annually.

Register as a sole trader via GOV.UK.

If you plan to grow beyond sole trading, forming a limited company provides liability protection but adds administrative requirements (Companies House filings, corporation tax). Speak to an accountant when your turnover approaches £30-50K.

5. Kitchen requirements

You can cook from home if your kitchen meets food hygiene standards. Your local authority environmental health team will inspect your premises (home or commercial) as part of the food business registration process.

For caterers who need more space or cannot use their home kitchen, commercial kitchen rentals are available:

• Shared/incubator kitchens: £10-20/hour or £400-800/month
• Dedicated rental: £800-2,000/month depending on location and size

Startup costs for a UK catering business

Item	Estimated cost	Essential?
Food business registration	Free	Yes
Level 2 Food Hygiene	£20-80	Practically yes
Insurance (annual)	£200-400	Yes
Basic equipment (pans, trays, transport boxes)	£300-800	Yes
Serving equipment (chafing dishes, platters)	£200-500	For events
Packaging and labels	£50-100	For PPDS
Website	£0-200	Recommended
Marketing materials	£50-150	Optional
Accounting software	£0-180/year	Recommended
Total startup	£820-2,410

The biggest ongoing costs are ingredients (bought per event) and your time. Many caterers start with a low fixed cost base and scale up equipment and kitchen space as bookings grow.

The software you actually need

From day one

• Accounting software: Track income and expenses for your tax return. Xero (£15-30/month) and FreeAgent (£12-24/month) are popular with UK sole traders. Both integrate with HMRC for Making Tax Digital.
• Recipe costing: Know what your food costs before you quote. A spreadsheet works initially. For multi-event scaling, see our guide on recipe costing and the free recipe scaling calculator.

When you outgrow basics

• Per-event costing: When you run 3+ events per week, manually costing each one in a spreadsheet becomes a bottleneck. The catering cost per head calculator handles multi-dish event costing with margin calculation.
• Allergen tracking: Under Natasha's Law, you must provide allergen information for PPDS food and be able to tell customers about allergens in non-prepacked food. See our PPDS labelling guide and the allergen matrix generator.
• Dedicated catering software: For a comparison of what to look for, see our buyer's guide to catering costing software.

What you do not need yet

• Staff scheduling software (you are a sole trader)
• Inventory management (you buy to order)
• CRM systems (a spreadsheet or your phone contacts are fine under 50 clients)
• Social media management tools (post manually to begin with)

First steps checklist

1. Register as a food business with your local council (free, allow 28 days)
2. Complete Level 2 Food Hygiene certification
3. Register as self-employed with HMRC
4. Get public liability and product liability insurance
5. Set up a separate bank account for business finances
6. Cost your first menu using the catering cost per head calculator
7. Set your per-head pricing using our pricing guide

Sources

• GOV.UK — Register a food business
• GOV.UK — Set up as a sole trader
• FSA — Allergen guidance for food businesses

This guide covers starting a catering business in the UK. It does not constitute financial, legal, or tax advice. Requirements may vary by local authority — check with your council for specific guidance.