Once you’ve decided a limited company is the right structure, forming one is a formal process — you’re creating a new legal entity, not just declaring that you’re trading. It’s more involved than registering as a sole trader, but it’s still a process most business owners can complete themselves in under an hour.
Before you start: decisions to make
You’ll need to have settled a few things before you begin the registration itself:
- Company name — must be unique, can’t be too similar to an existing registered company, and must end in “Limited” or “Ltd” (unless you qualify for an exemption)
- Registered office address — a UK address where official correspondence will be sent; this is public record, so many owners use an accountant’s address or a registered office service rather than a home address
- Directors — at least one director is required, who must be at least 16 and not disqualified from acting as a director
- Shareholders — at least one, who can also be the director; for a single-owner company, this is often the same person
- SIC code — a code describing what your business does, chosen from a standard list
Example: A single-person consultancy typically registers with one director and one shareholder — the same person — holding 100% of the shares.
How to register
Registration is done through Companies House, most commonly online:
- Companies House’s own online service is the cheapest and most direct route, with a small filing fee
- Many business owners instead register via an accountant or a formation agent, who handle the paperwork and can bundle in things like a registered office address or company bank account referral — this costs more but takes the admin off your plate
- You’ll need to provide company name, registered address, director and shareholder details, and your SIC code, and agree to a “memorandum and articles of association” (standard templates are fine for most small companies)
Approval is usually quick — often same-day when applying online — and you’ll receive a certificate of incorporation along with your unique company registration number.
Identity verification for directors and PSCs
Companies House is phasing in mandatory identity verification for all directors and people with significant control (PSCs), under powers from the Economic Crime and Corporate Transparency Act. If you’re incorporating now, you’ll need to verify your identity as part of the process — either directly through GOV.UK One Login or via an Authorised Corporate Service Provider, such as your accountant or formation agent. Existing directors and PSCs of companies formed before this requirement are being brought in on a phased basis through 2026, alongside their confirmation statement date. Filings from unverified directors can be rejected once the requirement applies to them, so it’s worth getting verified early rather than waiting for a deadline to force the issue.
What you get, and what it means
Once incorporated, your company is a distinct legal entity from you personally. This is the core benefit of setting up a limited company in the first place: the company can own assets, enter contracts, and incur debts in its own name, and your personal liability is generally limited to what you’ve invested.
Example: A construction subcontractor incorporating before taking on a large fit-out contract gets that separation in place before the risk on the contract exists — not after something’s gone wrong.
What happens straight after incorporation
A few things need setting up in the weeks that follow:
- Business bank account — a limited company needs its own account, kept separate from personal finances; this isn’t optional in the way it can feel optional for a sole trader
- Corporation Tax registration — you must register for Corporation Tax with HMRC within 3 months of starting to trade
- PAYE scheme — needed if you plan to run payroll, whether for yourself or employees
- Statutory registers — companies are required to keep certain internal records (register of directors, register of members, and so on), even though these no longer need to be filed publicly in most cases
- Confirmation statement — filed at least once a year, confirming company details are up to date
- Annual accounts — filed with Companies House, with different requirements depending on company size (small companies benefit from simplified filing)
- Corporation Tax return — filed with HMRC annually
- Company changes — updates to directors, registered address, or share structure must be filed as they happen, not just at year end
Ongoing obligations
Incorporation isn’t a one-off task — it comes with recurring filing requirements:
Missing these deadlines carries real consequences — Companies House can fine the company for late filing, and persistent failure to file can eventually lead to the company being struck off the register.
Example: A two-director company that changes its registered office address needs to notify Companies House promptly — this isn’t something that waits for the next confirmation statement.
Sole trader vs limited company registration, side by side
| Sole Trader | Limited Company | |
|---|---|---|
| Registers with | HMRC | Companies House |
| Creates a separate legal entity | No | Yes |
| Typical registration time | Minutes, confirmation by post | Often same-day online |
| Recurring obligations | Annual Self Assessment | Confirmation statement, annual accounts, Corporation Tax return |
| Public record | Minimal | Company details, accounts, and director info are publicly viewable |
Registering the company is the starting gun, not the finish line — the filings that follow are what keep it in good standing.