UK company formation: questions answered

Getting the structure right at incorporation is cheaper than fixing it later. This hub covers the formation decisions that matter: shares, addresses, SIC codes, secretaries, agreements and whether to incorporate at all.

How do I set up a limited company in the UK? Register with Companies House online with a company name, a registered office address, at least one director, shareholder and share structure details, people with significant control, a SIC code and identity verification for the people involved.

How long does it take to incorporate a company? Online incorporation is usually approved within 24 hours and often within a few hours on a working day. Paper applications take eight to ten days. Identity verification, sensitive name words or unclear PSC details can add time.

Should I be a sole trader or a limited company? Below roughly £30,000 to £40,000 of profit, sole trader is simpler with little tax difference. Above that, and especially where profit is retained in the business, a limited company is usually more efficient, with limited liability as the other main driver.

How many shares should I issue when forming a company? For a single owner, 100 ordinary shares of £1 each is a common and workable choice. Issuing more shares at a lower nominal value, such as 1,000 at 1p, gives finer percentages for future splits, investors or share transfers.

What share classes should I use for a family company? Separate classes, often called alphabet shares, let you pay different dividends to different shareholders. They work where each holder genuinely owns their shares with full rights, but arrangements designed only to divert income can be challenged.

What is a registered office address and can I use my home? The registered office is the company's official address for legal notices, shown publicly on the Companies House register. You can use your home, but it becomes public, and it must be an appropriate address where post is delivered and acknowledged.

Do I need a company secretary? No. Private limited companies have not been required to appoint a company secretary since the Companies Act 2006 took effect in 2008. The directors carry the statutory duties instead. Public companies must still have one.

What SIC code should I choose? Choose the SIC code that most closely describes your main trading activity from the Companies House condensed list. You can record up to four. It is a statistical classification, but banks, lenders and insurers read it.

Can I change my company name after incorporation? Yes. Pass a special resolution of the shareholders, file it with form NM01 and the fee, and Companies House issues a certificate of incorporation on change of name. The company number, history and contracts are unaffected.

Do I need a shareholders' agreement? If your company has more than one shareholder, yes. The articles alone do not cover deadlock, exits, what happens when a founder leaves, or restrictions on selling shares. A shareholders' agreement is private and fills those gaps.

Can I transfer my sole trader business into a limited company? Yes. You incorporate, then transfer the trade, assets and goodwill to the company. Capital gains can arise on goodwill and assets, but incorporation relief or holdover relief often defers the charge where the conditions are met.

Should I set up a holding company? A holding company makes sense when you have several trades, want to separate valuable assets or cash from trading risk, or are preparing a subsidiary for sale. It is not worth it for a single small trading company.

Rates, thresholds and deadlines quoted here reflect the 2026/27 UK position and current Companies House and HMRC guidance. Check GOV.UK, or ask us, before relying on them for your own company.