17 Mar 2020
There are numerous benefits associated with registering your business as a limited company. For instance, incorporating can help you build brand credibility and protect your personal assets. The process isn’t as long as it used to be and can take just a few hours. When you’re ready to register your business as a limited company, you’ll have to submit an application form to Companies House via the HMRC website. You can also download the form in PDF format and submit it manually. Some people decide to use a third party (such as their accountant) to process the application. Either way is fine! The following checklist will help you prepare the information you need to complete the application process smoothly.
The way you set up your business can have an impact on the way you pay tax and receive funding. Understanding all the available options will help you make an informed decision.
You can register as a...
A self-employed person / sole trader
If you’re unsure, you can ask HMRC for help.
This is the fun-but-often-difficult bit! When you register your limited company you’ll have to choose a unique company name. If it’s very similar to another company’s name you might have to choose a new one if they make a complaint.
You have to appoint at least one company director but having a company secretary isn’t mandatory for private limited companies. Company Directors are legally responsible for your business’ records, accounts and performance.
You’re required to have at least one shareholder or guarantor, and they’re also allowed to be a director. The majority of limited companies are ‘limited by shares’; in other words, they’re owned by shareholders who have rights.
That’s why directors often need to get shareholders to vote and agree if they want to make company changes.
A person with significant control (PSC) is anyone, for example, with voting rights or over 25% of the shares.
When you register your company, you’ll need to complete a memorandum of association and articles of association. The memorandum is a legal statement that all the initial shareholders and guarantors sign to say that they agree to set up the company.
The articles are essentially written rules about how the company will run. The shareholders or guarantors, directors and the company secretary must be in agreement.
All limited companies must keep all records relating to the company itself and financial and accounting activities. For the definitive list of specific records, you need to keep, consult the HMRC website.
Here’s a handful to give you an idea:
the results of any shareholder votes and resolutions
transactions when someone buys shares in the company
a register of ‘people with significant control’ (PSC)
all money received and spent by the company
Your registered address is where all official documentation will be sent, including correspondence from Companies House.
The address will be made publically available on the online register of companies, along with information about company directors, secretaries and PSCs.
A standard industrial classification of economic activities, or SIC code for short, is a system for classifying industries using a number. In case you’re interested, the manufacture of beer falls under code 11050 and book publishing comes under 58110!
Find your industry SIC code here.
After you’ve figured out all of the above, it’s time to register with Companies House.
Once successful, you’ll get a “certificate of incorporation”. The process costs £12 and usually takes up to 24 hours.
You might want to explore your funding options once your business is up and running. Our award-winning tech tool searches the market to find the right finance for your circumstances. It takes a few minutes to get started and it’s easy to navigate.
Find out what funding you’re eligible for today.
Sign up for the best of Funding Options sent straight to your inbox.