How splendid it is to plan a business? But, as we are aware, a business goes through various phases before taking its shape, from months and years of planning to laying the foundation stone. For the formation of any company, whatâ€™s most fundamental, of all phases, is the registration process.
The company formation in the UK follows similar legal procedures like anywhere else, more or less. The best way to go about the process, in my opinion, is through an expert, like a legal advisor or a registration consultant. This would save you a lot of time and money.
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Why Register a Company in the United Kingdom?
- It is the most crucial step to start a business.
- Besides, registering a company in the United Kingdom is a simple and affordable procedure.
- Whether you plan to run a small-scale business as a sole trader or establish a private/public company, registering your company name would save you a lot of future hassle and trouble. For instance, finding a different name for your company because theÂ one you had been using so far is already registered.
- Moreover, maintaining a tax record from the beginning is easy and anÂ added advantage for a registered company, in the long run.
How to Register a Company in the United Kingdom?
Before beginning the registration process, learn about the basic registration requirements, including the type of business you would like to register, necessary documents, income tax applicable, processing fee, and other related fees applicable, etc.
The United Kingdom has majorly three kinds of company registrations:
1. Sole Trader
A sole trader is basically an entrepreneur who runs a business individually and is solely responsible for the profits he makes, as well has incurs the losses entirely. He is liable to pay tax on his income.
2. Limited Company
If you plan to form a Limited company in the United Kingdom, be it Private or Public, its finances will be separate from your personal expenses. A Limited company will need to have a director and a shareholder, who both can be the same person. The Limited companies are liable to pay income tax, and can be funded by banks.
3. Business Partnership
As the term says, business partnership registration is for the companies started by 2 or more entrepreneurs, to run a business together. Each individual partner shares responsibility of his own business debt and account. Partnership companies are also liable to pay tax.
Steps to Register the Business in the United Kingdom
1. A unique company name
Firstly, you need to select a unique name for your company, which is dissimilar to the other companies registered, to avoid confusion.
2. Getting the Checklist ready
The checklist includes all the documents required to submit for registration, including the company registration application form, the memorandum and articles of association, and all other related documents containing information that needs to be shared with Companies House.
3. Application Submission
Fill the form and submit it, along with all the related documents. This would include the above-mentioned checklist, along with registered office address, statement of initial share capital to register a Limited or Partnership company, names and residential addresses of partners/shareholders.
4. Companies House Certificate Collection
The Companies House issues a document, upon the approval of the application registration, for instance, Certificate of Incorporation for Limited company. The certificate serves as a proof that your company has met all the registration requirements and contains all the details, like registration number, company name, date of incorporation, location, etc.
5. Filing with HMRC
The document issued by the Companies House then has to be filed with HMRC (tax collecting body in the UK), so that the HMRC can keep you posted about the taxes applicable on your company. You can also enroll for VAT, PAYE, Corporate Tax, and Self-assessment tax return, if applicable.
It is worth noting that, the United Kingdom has exactly the same laws for non-residents as residents, to register and run a business in the country. Also, a company can be registered online, as well as through post. A limited or partnership company would require a separate bank (current) account and a postal address as well.
Wishing you a smooth registration process.