Wondering how to set up a limited company (Ltd) in the UK? In this blog, we will go through the process, requirements, costs, and other must-know information.
How to Set up a Private Limited Company in the UK?
To form a company in the United Kingdom, you will need to register with Companies House, the government agency that oversees incorporation. The most popular and straightforward option is registering Ltd online, but you can also complete the process by post.
It involves the following steps:
- Choose a name that doesn’t infringe an existing trademark or match an existing brand name (you can verify this using the company name availability checker).
- Register your business address.
- Choose a standard industrial classification of economic activities (SIC) code, which classifies the type of business.
- Appoint a director (the person responsible for record-keeping and accounting).
- Appoint at least one shareholder, who owns at least a percentage of the business.
- Create a Memorandum of Association, a legal statement signed by the company’s shareholders. This is made automatically when forming a company online, but you can use a template from the government if you register by post.
- Create articles of association outlining how the organization will be run. You can either write your own or use model articles.
Using Omega to Register a Ltd
For many entrepreneurs, company formation is a huge blocker to starting a business due to time restraints or the complexity of the process. Sound familiar? Consider using a third-party service to help.
Omega can help you incorporate any company structure, including Private Limited Companies. Instead of going through all the steps outlined above, you can simply choose your name and fill out a short online form. Omega will handle everything, giving you peace of mind and an accelerated start.
What are the requirements for a limited company in the UK?
Setting up a limited company in the UK generally refers to private limited companies (LTDs). However, you can also choose a public limited company (PLC). In this case, you must have at least £50,000 in share capital, two shareholders, two directors, and a secretary.
This rules out most entrepreneurs, so PLCs are generally reserved for larger organisations that want to raise capital by selling shares. However, if you do want to opt for a public limited company, the process is the same, other than meeting the criteria outlined above. To verify this, you will need to apply for a trading certificate using a SH50 form.
What to Expect After a Limited Company Registration?
Shortly after registering, you will receive your Unique Taxpayer Reference (UTR) and certificate of incorporation by post. It’s important to keep these documents safe. But even after registering your business, there are a few more boxes to tick off.
First of all, Corporation Tax. Most people register for corporation tax at the same time as setting up their business, but if you’d prefer to handle it separately, you have three more months. If you have a turnover above £85,000, you’ll also need to register for VAT.
Then, you’ll need to pay attention to the day-to-day running of your firm. Setting up a business bank account to separate personal and company finances is crucial, as is keeping a record of spending and income ready for filing taxes.
LTD need to submit annual accounts and confirmation statements each year, plus records of anyone with 25% of a company’s shares or voting rights.
How Much Does it Cost to Set Up a Limited Company in the UK?
Incorporation of a LTD costs £50 (increased from a lower fee in May 2024) when using digital or software methods. If you want to incorporate by paper, you’ll face a higher fee of £71. You can also opt for same-day incorporation for £78.
What are the Requirements for a Limited Company in the UK?
The only requirements are that you should be at least 16 years old and not fall into any of the following categories:
- Disqualified by court order
- Disqualified by the company’s memorandum and articles of association
- Undischarged bankrupt
- The auditor of the company
How Long Does it Take to Set Up an LTD?
After you submit your application, it typically takes just 24 hours for your registration to be confirmed. This process may take longer if the government has a large number of applications to process. Postal applications take around ten days.
Can I Set up a UK Limited Company if I Live Outside the UK?
You don’t have to be a UK resident to set up a company in the country. However, you will need a registered address to receive mail and documentation. It’s also advisable to set up a business account in the UK to streamline your operations.
Opening an account with Omega makes this process easier by providing you with a London registered address and a multi-currency global business account.
Omega makes life easier for international entrepreneurs by offering a hassle-free way to register a business in the UK. As well as navigating the application for you, Omega will provide you with a multi-currency account in 14 currencies and various business services. Register your company with us today.
