Company formation
A limited company is a separate legal entity owned by shareholders and run by directors, with owners' liability limited to their shares. How it works in the UK.
Written and reviewed by Waqas Sagar Member of ICAEW, Fellow of ACCA, Fellow of AAT, a double graduate and entrepreneur at heart, helping startups grow and serving thousands of businesses nationwide with an excellent team. Published by LimitedCompany.Accountants, 12 London Road, Morden, London SM4 5BQ. Reviewed 21 October 2026 against 2026/27 UK rates and current Companies House and HMRC guidance.
A limited company is a business registered at Companies House that exists separately from its owners. It owns its assets, signs its contracts and pays corporation tax, while shareholders' personal liability for its debts is limited to any amount unpaid on their shares.
How a limited company works
Private and public limited companies
A limited company is a business registered at Companies House that exists separately from its owners. It owns its assets, signs its contracts and pays corporation tax, while shareholders' personal liability for its debts is limited to any amount unpaid on their shares.
Shareholders own the company and directors manage it; in most small companies the same person is both. Profits are taxed through corporation tax, and owners usually take money out as a small salary plus dividends.
The trade-off for limited liability is transparency: the company must file annual accounts and a confirmation statement at Companies House, keep statutory registers and file a CT600 with HMRC every year.
Most UK companies are private companies limited by shares, ending in Ltd. A public limited company (PLC) can offer shares to the public but needs at least £50,000 of allotted share capital. There are also companies limited by guarantee, often used by charities and clubs.
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.
Local help
We work with company directors across London and Surrey from our office at 12 London Road, Morden, London SM4 5BQ. Pick your area, or send the form below and we will call you back.
Frequently asked
Yes. One person can be the sole director and sole shareholder.
Often once profits pass roughly £40,000–£50,000, but it depends on your figures. Our sole trader vs limited tool compares both.
Not always. Personal guarantees, wrongful trading and overdrawn director's loans can still leave you personally liable.
Keep bank statements, sales and platform reports, purchase invoices, payroll records, VAT workings, finance agreements and Companies House correspondence. We confirm the exact list at onboarding and identify gaps before a filing deadline becomes urgent.
The fee depends on transaction volume, record quality, VAT and payroll requirements, historic catch-up and the level of reporting needed. We agree a fixed scope and price before technical work starts, with published packages available on our fees page.
Yes. We request professional clearance, collect the prior records and authorities, check the next Companies House and HMRC deadlines, and give you one clear handover list. The process is normally completed remotely.
Yes. We work through secure cloud records, scheduled reviews and digital approvals, while keeping a named team available by phone, video call and email. Clients can also visit our Morden office by appointment.
We regularly work with Xero, QuickBooks, FreeAgent, Sage and connected sales or expense apps. The right setup depends on transaction volume, integrations and the reports you need, not simply the software brand.
The relevant calendar may include annual accounts, Corporation Tax payment and return dates, confirmation statements, VAT returns, payroll submissions and Self Assessment. We map the dates from your company year end and registrations.
No. This page explains general UK rules and common accounting treatment. Your facts, contracts and wider tax position must be reviewed before you rely on a conclusion.
Included approach
Check the current rules
Deadlines, thresholds and filing rules change. GOV.UK and Companies House publish the current statutory position; advice should then be applied to your company’s circumstances.
Two ways to work with us
Everything is fixed price and agreed before we start. Prices are the same whether you are in London, Morden, Croydon or anywhere else in the UK.
All-inclusive packages
One fee covering your company’s filing calendar, with the price based on your turnover band.
One-off online filing
No monthly commitment. Add what you need to one basket and pay by card, with government fees shown separately at cost.
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Work with us entirely online, or sit down with your accountant at whichever office suits you. Open Monday to Friday, 9:00am to 5:30pm. Office visits are by appointment only, so please book before coming in.
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Pick a time that suits you and a qualified accountant will call you about your company, deadlines and fees.
Appointments run monday to friday, 9:00am to 5:30pm. Your confirmation is emailed straight away.
