Knowing how to set up a limited company in the UK is one of the biggest early decisions you’ll face as a business owner. Getting it right from the start sets the tone for everything that follows.
Whether you’re going solo or scaling something serious, incorporation gives your business credibility, protects your personal finances and opens up smarter ways to manage tax.
In this guide, we’ll walk you through the essentials of setting up your limited company. You’ll learn:
- How to register your company step by step.
- The documents you’ll need to get started.
- How to choose a company name that passes checks.
- What happens once your company is officially registered.
- Key things to look out for when incorporating your business with a formation agent.
- How Sleek makes the process simple and stress-free.
What is a limited company in the UK?
A limited company is a legal structure that separates your personal finances from your business. It has its own legal identity and is responsible for its own debts. That means your personal risk is limited to the amount you invest. There are two main types of private limited company, plus a third option for larger businesses:
| Company Type | Who it suits | Key features |
| Limited by shares | Most entrepreneurs | Owned by shareholders, profits kept after tax |
| Limited by guarantee | Charities and non-profits | Owned by guarantors, profits reinvested |
| Public limited company (PLC) | Larger businesses raising capital | Stricter rules, must publish financials |
Most small businesses in the UK start as a private limited company limited by shares (Ltd).
Step 1: Decide if a limited company is right for you
Running a limited company brings advantages like limited liability and potential tax efficiencies. It also boosts your business credibility with clients, suppliers and investors.
On the flip side, you’ll take on more reporting responsibilities. Annual accounts, confirmation statements and Corporation Tax returns all become part of your to-do list. It’s why we recommend taking an accounting package when you first launch.
In short:
- Choose a limited company if you want protection, credibility and room to grow.
- Stay as a sole trader if you value simplicity and want lighter admin.
For a deeper comparison, see our guide on sole trader vs limited company.
Step 2: Appoint your limited company directors and secretary
Every limited company needs at least one director. Company directors are legally responsible for running the company and filing with HMRC and Companies House.
Directors must:
- Be over 16
- Not be disqualified from the role
- Agree to take on legal responsibilities
You can also appoint a company secretary, though this is optional unless your company’s rules say otherwise.
If you’re setting up solo, you can be both director and shareholder. Many freelancers and consultants start this way.
Step 3: Decide who your shareholders or guarantors are
This step decides who owns or controls the limited company.
- Shareholders own shares in the company and may receive dividends.
- Guarantors don’t hold shares but promise to contribute a fixed amount if the business is wound up.
Most small companies issue one share to a single shareholder; often the founder. Bigger businesses may divide shares between multiple owners or investors.
Thinking of forming a new Limited Company? Sleek makes it easy.
Step 4: Identify people with significant control (PSC)
Companies House requires you to record anyone who has significant control over the company. That usually means anyone who:- Owns more than 25% of shares or voting rights
- Has the right to appoint or remove a majority of directors
- Influences important decisions
Most founders waste weeks fixing mistakes after a DIY registration. So set yours up right the first time to avoid headaches down the line.
Step 5: Choose your limited company name
Your company name must follow certain rules:
- It must be unique and not too similar to another registered name.
- It cannot be offensive or misleading.
- It usually needs to end in “Limited” or “Ltd”.
You can use our website to check name availability. Pick something professional and flexible enough to grow with your business. Naming it after a single product might limit you later.
Step 6: Prepare your limited company documents
You’ll need two documents before registering:
- Memorandum of association – confirms the agreement to create the company.
- Articles of association – sets the rules for running the company.
Most new businesses use standard templates provided by Companies House. Larger or more complex companies may draft their own. Sleek can help with both options to make sure you’re compliant.
Step 7: Register your limited company with Companies House
This is the step where your company officially comes to life. You can register online, by post or through a formation agent like Sleek.
Here’s what you’ll need to provide:
- Company name and registered office address
- Director and shareholder details
- PSC information
- Standard Industrial Classification (SIC) code
- Your company documents
Once approved, you’ll get a certificate of incorporation. This is proof that your company legally exists.
Online applications can be approved in as little as 24 hours. Paper applications usually take around a week.
Step 8: What to do after registering a limited company
Registering is just the beginning. To start trading, you’ll need to:
- Open a business bank account so your finances are separate.
- Register for Corporation Tax within 3 months of trading.
- Register for VAT if turnover exceeds £90,000.
- Set up PAYE if you plan to employ staff.
- Keep company records such as accounts, registers and minutes of decisions.
Here’s a quick summary:
| Task | Deadline | Why it matters |
| Open a business bank account | Before trading starts | Keeps personal and business finances apart |
| Register for Corporation Tax | Within 3 months of trading | Legal requirement from HMRC |
| Register for VAT | Once turnover hits £90,000 | Required by law |
| Set up PAYE | Before hiring employees | To manage salaries and taxes |
Get your limited company off to the right start with Sleek
Starting a company is exciting, but registering with Companies House is only the beginning. The paperwork, the compliance checks, and the ongoing tax obligations can quickly take over your time and energy.
Delaying the setup of proper systems only creates more stress later, when deadlines start piling up.
By incorporating your business through Sleek, you get more than just registration. You get:
- A fast, simple setup from day one.
- Your company records kept in order from the start.
- Ongoing expert support to help you stay compliant.
- Confidence to grow your business without admin worries.
So instead of second-guessing paperwork or worrying about missing a filing, you can focus on customers, growth and new opportunities.
Set up your company today with Sleek and give your business the strong foundation it deserves.
Effortlessly register your limited company with Sleek
FAQs about setting up a limited company in the UK
How much does it cost to set up a limited company in the UK?
Registering a limited company with Companies House costs £50 online or £71 by post. If you use a formation agent, fees vary but you’ll often get extras like help with documents, a registered office address, and fewer admin headaches.
How long does it take to set up a limited company in the UK?
If you apply online, most companies are registered within 24 hours. Postal applications can take 8–10 days. Using a formation agent often speeds things up.
Can one person set up a limited company?
Yes. You can be the sole director and sole shareholder. This is common for freelancers, contractors, and small business owners who want limited liability protection.
Do I need a business bank account for a limited company?
Yes. A limited company is a separate legal entity. You must open a business bank account to keep personal and company finances separate.
What is an SIC code when setting up a limited company?
An SIC (Standard Industrial Classification) code describes your company’s main business activity. You’ll need to choose at least one code when registering with Companies House.
When do I need to register my limited company for Corporation Tax?
You must register with HMRC for Corporation Tax within 3 months of starting to trade, which includes activities like selling, advertising, or hiring staff.
Can I change my company name later?
Yes. You can file a change of name with Companies House. The new name must still meet the same legal requirements as your original name.
How easy is it to set up a limited company in the UK?
It’s straightforward if you know what documents you need. You’ll need details of directors, shareholders, and a registered office address. Using a formation agent can make the process faster and reduce errors.
Do I need to set up a limited company as a contractor?
Many contractors set up a limited company to manage tax efficiently and access limited liability. However, rules like IR35 may apply, so it’s worth checking before you register.
Can I set up a limited company in Scotland, Ireland, or Wales?
Yes. Companies House registers companies across the UK. The process is the same whether you’re in England, Scotland, Wales, or Northern Ireland, though addresses must be based in the country of registration.
How do I set up a limited liability company in the UK?
The UK uses the term “private limited company” rather than “LLC.” To set one up, you must register with Companies House, file your incorporation documents, and pay the fee.
