A limited company is legally separate from the people who own it, and its owners' liability for its debts is limited.
Who can set one up and when
Anyone can set up a company, and you must register it with Companies House before it trades. You need not trade straight away, and a company that is not doing business can stay dormant. This covers the usual kind, a private company limited by shares. A company limited by guarantee has guarantors and a guaranteed amount in place of shareholders and shares, and is mostly used by non-profit organisations.
Verify each director's identity first
Every individual you name as a director in your application must have verified their identity with Companies House before you apply. You can verify once and reuse the personal code you receive.
Register your company
-
Choose a name
The name cannot be the same as another registered company's name, and you may have to change one that is too like another company's name or a trade mark if someone complains. It must usually end in Limited or Ltd. It cannot be offensive, contain a sensitive word or suggest a connection with government unless you get permission. Check the Companies House register for availability. You can trade under a different business name, which must not include limited, Ltd, LLP or plc.
-
Fix a registered office address and an email address
The registered office must be a physical address in the same country in which the company is registered, where post addressed to the company will reach you and the sender can get confirmation of delivery. You cannot use a PO Box. The address goes on the public register, so if you do not want your home address there, use your accountant's or solicitor's, with their permission. The registered email address is not published, and you must read what is sent to it.
-
Appoint at least one director
A director must be 16 or over, and at least one must be a natural person rather than a company. Directors need not live in the UK. You give each director's name, personal details and a service address, and Companies House publishes them. A person disqualified from being a director, or an undischarged bankrupt, needs the court's permission. A company secretary is optional.
-
Decide who holds the shares
You need at least one shareholder, who can also be the director. Give each shareholder's name and address, the number and type of shares and their total value, and the rights each type carries over dividends, redemption and votes. Most companies have one class, ordinary shares. Anyone who holds more than 25% of the shares or voting rights is a person with significant control, and you declare them in your application.
-
Settle your articles of association
Use the model articles, which apply by default, or write your own and send them with the application. If you apply online, the memorandum of association is created for you. If you apply by post, use the memorandum template and have all the initial shareholders sign it.
-
Apply to Companies House
Apply online, through commercial software, by post on form IN01, or through an agent. Online you need a Government Gateway user ID and password for the company, not your personal one. State what the company will do. You declare each director's verified identity and each person with significant control in the application.
What you get
Companies House sends a certificate of incorporation showing your company number and date of formation. The company then exists as a legal person.
If you registered online, you are usually set up for Corporation Tax at the same time, unless the company is dormant. If you registered by post, through an agent or through software, add Corporation Tax services to your business tax account when the company starts to do business. Doing business includes buying, selling, advertising, renting property and employing someone.
You need the company registration number, the date it started to do business, the date its first accounts are made up to and its Unique Taxpayer Reference. If you have no UTR 15 working days after registering, you can request it online. HMRC then sends an activation code, usually within 10 days. Whatever the company's results, it must file a Company Tax Return.
Legal basis
Primary legislation and key regulations