Registering a company is a legal process that officially establishes your business as a separate legal entity. It is a key step when starting a new business in the UK.
Company registration confers certain benefits, such as limited liability for the owners. It also makes your business appear more credible to customers and lenders and prevents others from using your business name.
The process involves submitting incorporation documents, appointing directors, selecting a registered address, and more. Companies House handles registration for most companies in the UK. The process can be done directly or through a formation agent.
While company registration may seem complex, it can be straightforward if you understand the requirements and prepare accordingly.
This article will walk through the key steps involved in successfully registering a company in the United Kingdom.
How to Register a Limited Company
Here is our simple 9 step process to registering a company, breaking down each section in detail. Of course, if you use a company formation agent, most of this will be done for you but it’s helpful to understand the process.
|1. Decide on a Company Name||Directors must be 16 or older, obtain consent, and provide personal details.|
|2. Appoint Company Director(s)||State the number and value of shares, outline rights and restrictions, name initial shareholders.|
|3. Choose a Registered Office Address||Must be a physical UK address, residential, and publicly viewable.|
|4. Prepare Incorporation Documents||Include Memorandum and Articles of Association, use standard or custom templates.|
|5. Define Share Structure and Shareholders||Apply online for a quicker process, pay £12 fee, takes about 24 hours for approval.|
|6. File for Registration||Apply within 3 months obtain Unique Taxpayer Reference.|
|7. Register for Corporation Tax||Apply within 3 months, obtain Unique Taxpayer Reference.|
|8. Open a Business Bank Account||Separate business finances, compare features and fees.|
|9. Maintain Statutory Records||Keep accurate financial records, meet filing deadlines, update details with Companies House.|
9 Steps to Registering a Company
(1) Choose a Company Name
One of the first steps in setting up a limited company is choosing a unique and available name. Choose something memorable and relevant to your business.
Here are some things to keep in mind when choosing:
- Check the availability of the name on the Companies House website here.
- Avoid using sensitive or offensive words.
- You can append “UK” or “Limited” to your company name to make it more unique but do not include “Ltd” before registration.
- Avoid using punctuation or stylized spellings.
- Consider a few alternative names in case your first choice is unavailable.
- You do not have to trade under your registered company name. You can use a different business name or trademark.
- Make sure the .co.uk domain name is available for your company name if you plan to use it online.
(2) Choose your Company Formation Method
Are you going to register the company yourself through Companies House or use a company formation agent?
Our advice is to use a company formation agent. At the moment, Tide Bank is offering to do this for you, for free (they bear the £12 cost), meaning it will be cheaper and much more streamlined than doing it yourself.
Registering Directly with Companies House: It’s a straightforward process to register a company directly with Companies House. You’ll have to fill out the necessary forms, provide all requisite details, and ensure all documentation is up to par. However, the challenge lies in ensuring that all paperwork is completed correctly. Mistakes can lead to delays or potential legal issues. Moreover, you’ll be responsible for understanding the complexities of company law and ensuring all requirements are met, which can be a daunting task for first-time entrepreneurs.
Using a Company Formation Agent: On the other hand, a company formation agent is a third-party service that specializes in setting up new companies. These agents bring a wealth of experience and knowledge to the table, streamlining the incorporation process for new business owners. Opting for an agent means you’ll get expert guidance throughout the registration process. They can provide additional services like drafting shareholder agreements, offering registered office addresses, and even assisting with opening business bank accounts.
(3) Appoint Company Directors
Every UK company must have at least one director appointed during registration. The directors are responsible for the management and oversight of the company.
Becoming a director is a serious responsibility that comes with legal implications. It is important to understand these implications before agreeing to become a director.
Here are some basic rules about directorship eligibility:
- Directors must be at least 16 years old and not disqualified from the role.
- The same person can serve as both director and company secretary.
- Directors should understand their legal duties and liabilities.
When appointing directors, you will need to provide the following information for each director:
- Full name
- Date of birth
- Contact details
- Service address (this is publicly available)
- Usual residential address
- Non-UK residents can serve as directors of a UK company.
- Confirm that each director has consented to act in the role.
Appointing responsible directors who understand their obligations is key to proper company management. Take time to select suitable candidates for these important roles.
Here are some additional tips for appointing directors:
- Consider the skills and experience that each candidate brings to the table.
- Make sure that the directors are committed to the company’s success.
- Require the directors to sign a declaration of consent to act as a director.
- Keep a record of the directors’ names, addresses, and contact details.
(4) Choose a Registered Office Address
All UK companies must have a registered office address. This is the company’s official address that is recorded on the Companies House register. The registered office address must be a physical location, not just a PO Box.
There are a few things to keep in mind when choosing a registered office address:
- The address must be in the UK.
- It does not have to be the same as the company’s trading address or business premises.
- Residential addresses are allowed, but the company must have permission from the homeowner to use the address.
- Using your home address can provide privacy, but it also means that you will be responsible for receiving all of the company’s mail.
- Virtual offices can provide a business address and mail-handling services.
- The address will be publicly available on the Companies House register.
- You can use a registered agent’s address, which is a company that provides registered office services to other businesses. This can give your company a more professional image.
The registered office address can be changed later by filing forms with Companies House.
Here are some factors to consider when choosing a registered office address:
- Privacy: If you want to keep your home address private, you can use a virtual office or a registered agent’s address.
- Convenience: If you want to be able to easily access the mail for your company, you may want to choose an address that is close to your home or office.
- Cost: The cost of renting a virtual office or using a registered agent’s address can vary. You will need to factor in the cost when making your decision.
- Professionalism: If you want to give your company a more professional image, you may want to choose a registered office address in a prestigious location.
(5) Prepare Company Incorporation Documents
When you register a company in the UK, you will need to prepare certain legal documents. These documents are called the Memorandum of Association (MOA) and the Articles of Association (AOA).
The memorandum of association (MOA) is a foundational document that sets out the basic information about your company, such as its name, its registered office address, and its objects (i.e., its purpose). All of the company’s directors must sign the MOA.
The articles of association (AOA) are a more detailed document that sets out the internal rules of your company, such as how it will be managed and operated. The AOA can be tailored to your specific needs and requirements.
You can use model articles of association provided by Companies House, but it is advisable to have your AOA drafted by a lawyer or a company formation agent. This will ensure that the AOA is tailored to your specific needs and that it complies with all applicable laws and regulations.
Once your MOA and AOA have been drafted, they must be professionally printed and bound before they can be submitted to Companies House.
You can register your company online or by paper. The same incorporation documents are used for both methods of registration.
Here are some tips for drafting suitable articles of association and memorandum of association:
- Be clear and concise.
- Use plain language that is easy to understand.
- Avoid using jargon or technical terms.
- Be specific about the company’s objectives and how it will be managed.
- Make sure the documents are compliant with all applicable laws and regulations.
(6) Select Share Structure and Shareholders
When you register a company in the UK, you will need to select a share structure and identify the shareholders of the company.
The share structure determines how the ownership of the company is divided between the shareholders. There are two main types of shares: ordinary shares and preference shares.
- Ordinary shares are the most common type of share. They give the holder the right to vote on company matters and to share in the profits of the company.
- Preference shares have a higher priority than ordinary shares when it comes to receiving dividends and assets in the event of a liquidation. However, preference shareholders do not have voting rights.
The number of shares and their nominal value (i.e., the face value of the shares) are also important factors to consider when selecting a share structure. The nominal value of a share is not necessarily equal to its market value.
The rights and restrictions attached to each share class should also be outlined. For example, some shares may have voting rights, while others may not. Some shares may have a preferential right to dividends, while others may not.
The share value can start at just £1 to limit the liability of the shareholders. However, it is important to note that the share value is not the same as the market value of the shares. The market value of the shares can fluctuate depending on a number of factors, such as the performance of the company.
The names and details of the initial shareholders must also be listed. The shareholders own the company assets proportional to the number of shares they hold. The same person can be both a director and shareholder.
The share allotments can be changed later by proper procedures. However, it is important to note that any changes to the share structure must be approved by the shareholders.
Clearly establishing the share structure and shareholders is an important part of the company registration process. It is important to choose a share structure that is appropriate for the company’s needs and to identify the shareholders who will be investing in the company.
(7) Submit Everything to Companies House
Once you have prepared all of the necessary documents, you can file for the incorporation of your company with Companies House.
There are two ways to file for incorporation: online or by post.
Online filing is the quickest and easiest way to file for incorporation. You can do this through the Companies House website. You will need to create a Government Gateway account and pay a filing fee of £12.
Paper filing is also possible, but it takes longer to process. You will need to download the relevant forms from the Companies House website and send them by post.
Once your filing has been processed, you will receive a certificate of incorporation. This is the official document that confirms that your company has been incorporated.
(8) Open a Business Bank Account for Your New Company
A business bank account is essential for any company that wants to keep its finances separate from its personal finances. It also allows businesses to make and receive payments more easily, and it can help to improve cash flow management.
When choosing the best business bank account, there are a few things to keep in mind:
- The features and benefits offered: Some business bank accounts offer features such as online banking, mobile banking, and bill pay. Others may offer business loans or credit cards.
- The fees charged: Business bank accounts often have monthly fees, and some may also charge fees for ATM withdrawals, wire transfers, and other transactions.
- The requirements for opening an account: Most banks will require you to have a certificate of incorporation and other documentation before you can open a business bank account.
Once you have chosen a business bank account, you will need to provide the necessary documentation and open the account. You can usually do this online or in person at a branch.
(9) Maintain Statutory Records
The key requirements when maintaining statutory records for a company are as follows:
Keeping Company and Financial Records
- Include details about directors, shareholders, company secretaries, shareholder votes, transactions, and financial activities.
- Retain for at least 6 years from the end of the relevant financial year.
Comply with Companies House Requirements
- Optionally, submit statutory registers (e.g., directors, members) to the public register at Companies House.
- Maintain a historic register if member information is kept on the public register.
- Ensure prompt correction and verification of public register details.
Meet Filing Deadlines
- Timely file annual accounts and Company Tax Returns.
- Report changes in company structure or governance promptly.
Consider Professional Advice
- Engage accountants or legal experts to ensure accuracy and compliance.
Staying vigilant in the above areas will help to avoid legal issues and ensures company transparency.
What is Required to Register a Company in the UK?
To incorporate a company in the UK, you must have:
- A unique company name.
- A UK-based address for the company.
- A minimum of one director; UK residency isn’t mandatory.
- At least one shareholder, either an individual or another company.
- A ‘memorandum’ and ‘articles of association’ document. Standard templates are available, or they can be custom-created by professional advisers.
Note: While UK residency isn’t legally required for directors or shareholders, many UK banks prefer resident directors or shareholders before opening a business bank account.
Can anyone register a company in UK?
Yes, virtually anyone can register a company in the UK.
There are minimal requirements, such as having at least one director who is a natural person and at least 16 years old, a registered office address in the UK, and the issuance of at least one share. The directors, secretaries, and shareholders do not have to be based in the UK, and corporate bodies can also act in these roles, alongside a natural person as a director.
Therefore, the process is designed to be accessible to nearly anyone who wants to form a company in the UK, whether they reside in the country or not.
How much does it cost to register a limited company in the UK?
Based on the information provided, the cost of setting up a limited company in the UK depends on the approach you take, and here’s a breakdown of the different routes:
- Do-It-Yourself Approach:
- Initial fee for registering with Companies House: £12 for electronic service, £40 for paper version.
- Corporation Tax registration: £12 if done online.
- Business bank account setup: May have fees but fee-free options are available.
- Using An Accountant:
- Accountant’s fee: Between £50 and £300, plus VAT if applicable.
- Recharge costs for Companies House fee & Corporation Tax Registration: These will be recharged back to you or added to the invoice.
- Using A Third Party Formations Agent:
- One-off, fixed fee: Ranges between £20 and £200 depending on services. More comprehensive packages might be pricier.
Company Registration Checklist (UK)
Follow these key steps to register your company with Companies House and get off to the right start:
☐ Choose a Unique Company Name
- Check availability with Companies House database
- Avoid restricted or offensive words
- Add “UK” or “Limited” for uniqueness
☐ Appoint Company Director(s)
- All directors must be 16+ years old
- Get consent to act from each director
- Provide required personal details
☐ Select Registered Office Address
- Must be a real physical address
- Can use a residential address
- Address will be publicly viewable
☐ Prepare Incorporation Documents
- Memorandum of Association
- Articles of Association
- Use standard templates or customize
☐ Define Share Structure and Shareholders
- State number and value of shares
- Outline rights and restrictions
- Name initial shareholders
☐ File for Registration with Companies House
- Apply online for quicker registration
- Pay £12 fee by card or account
- Takes up to 24 hours for approval
☐ Register for Corporation Tax
- Apply within 3 months of starting business
- You’ll get a Unique Taxpayer Reference
☐ Open a Business Bank Account
- Keeps finances separate from personal
- Shop around to get best features
☐ Maintain Statutory Records
- Keep accurate financial records
- Comply with filing deadlines
- Update details with Companies House
Start Your Company Registration Process
Starting your own company has never been more straightforward! To begin your company registration journey, all you need to do is click on this link. We’re proud to be partnered with Tide, who offer a seamless and completely free company registration service.
Not only will you be able to register your company with ease, but with Tide, you also get the added advantage of opening a bank account at no additional cost. This means you’ll be able to set up your business finances right from the outset without any unnecessary hurdles.
Why wait? Start your entrepreneurial journey with confidence and with the right partner by your side.
How Long Does It Take to Set Up a Limited Company?
The online registration with Companies House usually takes around 24 hours. If you use a paper application, it might take longer.
What Documents Are Required for Forming a Limited Company?
You’ll need a Memorandum and Articles of Association, along with details about the company’s directors, shareholders, and registered office address.
Can I Set Up a Limited Company Myself?
Yes, you can take the DIY approach or use an accountant or a third-party formation agent.
What Are the Pros and Cons of Different Registration Approaches (DIY, Accountant, Third-party Agent)?
DIY is usually cheaper but requires more effort; an accountant offers expertise but costs more; a formation agent simplifies the process with varying costs.
How Can I Check if My Desired Company Name is Available?
You can use the Companies House WebCHeck service to see if your desired name is already in use or most formation agents have their own tools to check availability against Companies House records.
Can I Register a Limited Company Online?
Yes, you can register online through Companies House, or through accountants or third-party formation agents. Online registration usually takes around 24 hours.
Can I Change My Company Name After Registration?
Yes, but you must follow proper procedures, inform Companies House, and update all company documents and records.
What Happens After My Limited Company is Registered?
You’ll receive a certificate of incorporation, and you can then start trading. You’ll also need to meet ongoing legal, tax, and regulatory obligations.
Can I Use My Home Address as the Registered Office Address?
Yes, but it will become publicly available information, so some business owners prefer to use a professional registered office service.
Is It Possible to Register a Limited Company If I’m Not a UK Resident?
Yes, non-UK residents can register a limited company, but there must be a registered office address within the UK.