Company Incorporation Step by Step: United Kingdom
By Celestine Loh, Last updated: 2021-10-22 (originally published on 2020-09-10)
This article covers the main points on registering a company in the United Kingdom. Read on for details on the United Kingdom’s requirements, procedures, and the estimated timeline to register a company.
Minimum Setup Requirements to Register a Company in the United Kingdom
In the UK, there are 2 common types of companies – private and public companies.
For private companies, the requirements are:
- Director – 1, at least 1 director must be an individual director
- Shareholder – 1
For public companies, the requirements are:
- Directors – 2, at least 1 director must be an individual director
- Company Secretary – 1
- Shareholder – 1
The legal requirements in the UK are very strict for directors and company secretaries.
To be a director, you cannot be:
- Disqualified from acting as a company director
- An undischarged bankrupt
- Under the age of 16
To be a qualified company secretary, you must be:
- From the office of secretary of a public company for at least 3 years of the 5 years before your appointment to the new company
- A barrister/ advocate/ solicitor called or admitted in any part of the UK
- A member of any of the following professional bodies
- Institute of Chartered Accountants in England and Wales
- Institute of Chartered Accountants of Scotland
- Institute of Chartered Accountants in Ireland
- Institute of Chartered Secretaries and Administrators
- Association of Chartered Certified Accountants
- Chartered Institute of Management Accountants
- Chartered Institute of Public Finance and Accountancy
In the UK, the incorporation process can be done on 3 different platforms. For each platform, the timing differs.
- Electronic Software Filing
Done usually be external services that have their own websites to help with incorporation. The standard fee for this platform is £10 and usually takes 24 hours.
- Web Services
The easiest online, one-stop platform to register your company with Companies House and HM Revenue and Customs (HMRC). The standard fee for this platform is £12 and usually takes 24 hours.
- Paper Filing
The only physical platform to incorporate your company. The documents must be submitted to the correct offices and therefore, will take a longer time. The standard fee for this platform is £40 and usually takes 5 working days.
Step 1: Submit relevant forms
Unlike other countries, there is no reservation of the proposed company name for the UK’s incorporation. The proposed company name must be submitted along with all the relevant documents needed. However, you can check if the proposed name has not been registered here.
The documents that need to be submitted are:
- Form IN01
This application form requires details like:
- Proposed company name
- Official place of business address
- Type of company structure (private/public/unlimited)
- Details on the type of business activities
- Choice of Articles of Association
- Details of proposed director/s and company secretary (if needed)
- Details of people with significant control (PSC)
- Residential addresses of director/s
- Statement of capital and initial shareholdings
- Statement of compliance/ guarantee
- Memorandum of Association
- The required contents of the Memorandum of Association can be found in the revised Companies Regulations 2008. Or, you can download a pro forma memorandum here. Most importantly, the wording for the memorandum is prescribed, amending it will result in the submission being invalid.
- Articles of Association
The internal rulebook of the company, it can be decided by the company members. It should not contain any rules that go against the law. It can be adopted/ taken wholly from the model articles here.
After all the above documents are submitted with valid information, the government will issue a Certificate of Incorporation that officially incorporates your company.
Step 2: Open the company bank account
The next step after incorporation is to set up a company bank account. Before application, it is important to have all the needed documents on standby to make the process fast and smooth.
- Proof of ID
- Proof of personal address
- Full business official address
- Contact details of the business
- Companies House registration number
- Estimated annual turnover
Step 3: Register your company for Corporation Tax
Most companies are required to register for Corporation Tax and PAYE within 3 months of the incorporation of business. You will require the following:
- Company’s Unique Taxpayer Reference (UTR)
- Company’s registration number
- The commencement date of business
- The date the annual accounts are made up to
Once the following are submitted to the HMRC, a deadline to pay corporation tax will be given. Additionally, all companies must file a Company Tax Return.
The accounting year must not be longer than 12 months and it usually follows the financial year. For new incorporated companies, the HM Revenue and Customs (HMRC) will issue a letter with the dates for the accounting period.
In the event that the accounts cover more than 12 months, you must file for 2 returns.
Corporate Tax Requirements
Once you have registered for Corporate Tax, you must keep all accounting records and prepare a Company Tax Return. The deadline to pay the tax (or to declare nothing to pay) is 9 months and 1 day after the end of the accounting period. The average corporation tax payable is 19%.
Annual General Meeting
For public companies, the AGM must be held annually within the period of 6 months beginning with the date following its accounting reference date.
It is not compulsory for private companies to hold an AGM annually but it is recommended.
This article does not constitute legal advice.
The opinions expressed in the column above represent the author’s own.