Use this guide if you are starting a business or thinking of moving from sole trader to a company. Have a proposed company name, a registered office address in the part of the UK where you will register (England and Wales, Scotland or Northern Ireland), and photo ID for each director ready.
Step by step
Check a company is right for you
A limited company is a separate legal entity, which can limit your personal liability but brings more paperwork and public records. Compare it with being a sole trader, including how you would pay yourself and the tax involved. Speak to an accountant or a free business support service if you are unsure.
Choose a name and addresses
Check your name is available using the Companies House name search and does not clash with an existing trade mark. You need a registered office address, which will be public, and an appropriate email address for Companies House. You can use a service address so your home address is not shown for directors.
Verify your identity
Directors and people with significant control must verify their identity with Companies House, for example through GOV.UK One Login or an authorised agent. Once verified, you receive a personal code to use when you register. Check the current requirements on GOV.UK before you start.
Register the company
Register online with Companies House, giving the directors, shareholders, people with significant control and the company's main business activity. Most small companies use standard model articles of association. You will receive a certificate of incorporation and a company number once registered.
Set up tax and banking
Register the company for Corporation Tax with HMRC within the deadline shown on GOV.UK. Open a separate business bank account in the company's name and keep company and personal money apart. Register for PAYE if you will pay yourself or others a salary, and consider VAT if relevant.
Put records and deadlines in place
Set up bookkeeping from day one and keep records of all income, spending and decisions. Add your confirmation statement, annual accounts and Corporation Tax deadlines to a calendar. Consider using an accountant, as late filing brings automatic penalties.
Ready-to-use checklist
- Company versus sole trader compared
- Name checked for availability
- Registered office address arranged
- Identity verified for each director
- Company registered and number received
- Registered for Corporation Tax
- Business bank account opened
- Filing deadlines in a calendar
Practical tips
- Only use the official Companies House and GOV.UK services; letters asking you to pay to be listed in business directories are often not official.
- Keep a simple record of any money you lend to or take from the company, as this affects your tax.
- Check that your business insurance and any contracts are in the company's name, not yours personally.
Common problems
Your chosen company name is already taken or too similar.
Try a variation that is clearly different, or add a descriptive word. You can trade under a different business name as long as it follows the rules on GOV.UK.
Your identity verification failed.
Check the details you entered match your ID exactly. Try another verification route, such as an authorised corporate service provider, or contact Companies House for help.
You have received a letter about a missed deadline.
Read it carefully and check the date, then file the missing document as soon as possible to limit penalties. Contact Companies House or HMRC if you have a reasonable excuse, and consider getting an accountant.
This guide gives general information, not personal legal, financial or medical advice. Rules and prices change, so check the current position with the official service before acting.
This guide is free. Unlock all ABCDayZ guides from £3.99 – one payment, no automatic renewal.