Are you an aspiring entrepreneur looking to register a company in the UK?
Registering a company can seem like a daunting task, especially if you’re not familiar with the process. But fear not, this guide will help you with the process, from choosing a name to filing your company documents. With the right guidance and a bit of patience, registering a UK company can be a straightforward and rewarding experience.
So grab a cup of coffee and let’s get started on this exciting journey towards creating your very own company!
Why Register a Company?
There are a number of different business structures in the UK. These include sole-traders, partnerships and companies. Before you register a company at Companies House. You should ensure that it is the right structure for your business.
This video below from HMRC introduces the idea.
We briefly consider some of the benefits of trading as a company below, but this is not intended to be compressive and there may be disadvantages. We strongly recommend that you seek professional advice.
Registering a company offers many benefits, including some legal protection for your business. A registered company is a separate legal entity from its owners, which means that your personal assets are protected from any liabilities incurred by the company.
This is particularly important if you plan to operate in a high-risk industry or offer services that could result in legal disputes. There are certain restrictions to this protection for example if you give a personal guarantee, if you have acted dishonestly or as a director you have not acted within the law.
In addition to legal protection, registering a UK company arguably also enhances your credibility and professionalism. Some people believe there is more kudos trading through a company. This could give potential customers and investors ah higher perception of your ability to deliver quality products or services.
There may be tax advantages in trading via a company, this area is complex and we would certainly recommend obtaining professional advice from a Chartered Accountant.
Finally, registering a company at Companies House may also opens up funding opportunities that could not be available to unregistered businesses. You may be eligible for loans, grants, or investment from banks, government agencies, or private investors. This could provide the financial stability and resources you need to grow your business.
Types of UK Companies
Before you can register your company, you need to decide what type of company you want to form. There are several types of UK companies, including:
– Private Limited Company (Ltd): This is the most common type of UK company, which offers limited liability protection for its owners.
– Public Limited Company (PLC): This type of company is required to have a specified amount of share capital, and its shares can be traded on a recognised stock exchange.
– Limited Liability Partnership (LLP): Not strictly a company but it has many similarities to a private limited company. It offers limited liability protection to its members. Many professional partnerships such as lawyers and accountants trade as LLPs. Although LLPs are not limited to them.
– Community Interest Company (CIC): This type of company is designed for businesses that have a social or environmental purpose, and must use their profits for the public benefit.
Once you’ve decided what type of company you want to form, you can move on to choosing a name. As Private Limited Companies are the most common, the rest of this post deals with this type.
Choosing a Company Name
Choosing a company name is an important step in the registration process. Your company name should be unique, memorable, and relevant to your business. You can check if your desired name is available by searching the Companies House name availability checker.
Your company name must also comply with certain rules, such as not being offensive or misleading. You may find our blog “4 Reasons why Companies House may reject a company name” useful. It must also include the word “Limited” or “Ltd” at the end.
Once you’ve chosen a name and confirmed its availability, you can begin the registration process with Companies House.
Register a Company with Companies House
You can use an accountant, lawyer or company formation agent to register a company for you. However, you can choose to carry out the process yourself.
To can register your company with Companies House on their website here is a link. Some of the information you will be required to provide:
1. Certain personal information about shareholders and directors.
2 .Your company name.
3. Your company’s registered office address.
4. Details of your directors and shareholders or guarantors.
5. Details of Persons with Significant Control (PSC).
6. Pay the registration fee. Currently £12.
7. Documents agreeing how to run your company.
Once you’ve successfully completed your application, you’ll receive a Certificate of Incorporation, which confirms that your company is registered with Companies House.
Registering for Taxes
Once your UK company is registered with Companies House, you’ll need to register for taxes. This includes registering for Corporation Tax, which is a tax on your company’s profits. Other common registrations include; Value Added Tax (VAT), which is a tax on your sales and Pay As You Earn (PAYE) in most circumstance where the company employs people.
You can register for taxes online using the HM Revenue and Customs (HMRC) website.
Setting Up a Business Bank Account
You’ll need to set up a business bank account for your company. This will enable you to manage your finances and make payments to suppliers and employees.
You can choose from a range of UK banks and compare their fees and services to find the best option for your business. You may need to provide your Certificate of Incorporation and other company details to open a business bank account.
Conclusion and Next Steps
Registering a UK company may seem like a daunting task, but with the right guidance and a bit of patience, it can be a straightforward and rewarding experience.
At Harries Watkins Jones Chartered Accountants we can assist with;
- Advising on business structures
- Registering a Company
- Registering for tax
- Advice on what accounting records your company needs to keep and how to keep them
- Tax advice
- Business plans