How to Start a UK Limited Company

How to Start a UK Limited Company

How to Start a UK Limited Company

If you're thinking of starting a small business in the United Kingdom, you'll need to set up a limited company. A limited company is a business entity that has been incorporated and registered with Companies House, the U.K.'s registry of companies. This process can seem daunting, but we're here to help. In this blog post, we'll walk you through the steps of how to start a U.K. limited company.

1. Choose your company name 

The first step in starting a limited company is choosing a name for your business. Your company name should be distinct from any other registered company and cannot be offensive or misleading. You can check to see if your chosen name is available by searching the Companies House online database.

2. Register your company with Companies House 

Once you have chosen a name for your company, you will need to register it with Companies House. To do this, you will need to file several documents, including the Memorandum and Articles of Association, which outline the purpose and rules of your company; the completed LL1 form, which is the application to incorporate a private limited company; and the fee for registration, which is currently £12.

3. Appoint directors and secretaries. 

Every limited company must have at least one director . The director(s) manage the day-to-day operations of the company and are responsible for its compliance with legal requirements.

4. Open a bank account. 

Once your company has been registered with Companies House, you will need to open a bank account in the name of your limited company. To do this, you will need to provide proof of your incorporation, such as the certificate of incorporation or memorandum and articles of association.

5. File annual accounts with Companies House. 

All limited companies must file annual accounts with Companies House within nine months of their financial year-end date. Accounts must be prepared in accordance with generally accepted accounting principles (GAAP). There is no legal requirement for you to use an accountant to file these, however most business owners do. 

6 . File annual confirmation statements with Companies House 

In addition to filing annual accounts , all limited companies must file an annual confirmation statement with Companies House . A confirmation statement confirms that information about your company is up-to-date and includes details such as your registered office address, share capital, and list of directors and secretaries. Along with the filing you must pay the annual fee of £13 to Companies House. 

7 . Pay corporation tax on profits 

All limited companies must pay corporation tax on their annual profits . The current rate of corporation tax is 19% 

The rate of corporation tax rate is due to increase from April 2023 and you can find out more about that here

8 . Comply with employment law requirements 

If you have employees, you will need to comply with certain employment law requirements, including paying taxes and National Insurance contributions, providing minimum wage pay, sick pay, paid holiday entitlement, upholding health and safety standards, and adhering to anti-discrimination laws. It is also a legal requirement to have Employers Liability Insurance in place when you have employees. 

9 . Comply with other legal requirements

There are numerous other legal requirements that apply to all businesses in the United Kingdom, including VAT registration (if applicable), registering for Self Assessment, as well as complying with fire safety regulations, data protection laws, and environmental regulations.

These are just some of the basics of how to start a UK limited company. 

Starting a UK limited company can seem like a daunting task, but we're here to help! Just follow these simple steps, and you'll be up and running in no time flat.

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About the Author

Annette Ferguson 

Owner of Annette & Co. - Chartered Accountants & Certified Profit First Professionals. Helping online service-based entrepreneurs find clarity in their numbers, increase wealth and have more money in their pockets.