Setting up a business in the United Kingdom can open the door to one of the world’s most stable and business-friendly environments, but you may need to register your company in the U.K. to do it. Whether you’re expanding internationally or starting a business in the U.K. as a foreigner, registration is often the first step. With all the proper boxes checked, you’ll soon be able to set up bank accounts and other infrastructure, hire employees, and operate with complete compliance.
It’s relatively straightforward to open a company in the U.K., but you must follow important regulatory, financial, and administrative rules and regulations. Missing something can mean additional costs and delays.
This article walks you through everything you need to know about registering a U.K. company, including legal requirements, expected costs, and the difference between low-cost and higher-end setup options.
Requirements for company registration in the U.K.
There are several pieces of information you’ll need to have in place before you can start the registration process, whether you’re based in the U.K. or operating abroad:
- A U.K.-registered office address: Every U.K. company must have a registered office, which is an address where business-related mail and legal notices are sent. This address must be a physical location within the U.K. (England, Scotland, Wales, or Northern Ireland). It can be your actual office, accountant’s address, or a virtual office provider, but can’t be a PO box.
- A designated company director: A company in the U.K. must have at least one director, who is the person responsible for managing the business and filing company documents. Directors must be 16 or older and can reside outside of the U.K. Company directors are listed publicly by Companies House, an executive agency of the British government that oversees company registrations.
- Shareholder or guarantor information: Some types of private limited companies (LTDs) must have at least one shareholder. When establishing an LTD by guarantee (which is more typical for charities), you’ll need at least one guarantor for the company’s debts. Both the shareholder and guarantor are a person (or group of people) who owns the company, and the director can play either role. You’ll need to determine how many shares to grant this person and how to value them. This information also needs to be registered with Companies House.
- A valid company name: You must have a unique company name to register your business. It can’t be too similar to another company’s name (generally a good business practice to maximize visibility) or use sensitive or offensive terms, or copyrighted words without permission. You can conduct a Companies House search to see what names on your list have already been taken. The agency will need to approve your name as part of registration, so have a few ideas on backup just in case.
8 steps to register a business in the U.K.
Once you have all your dreams on paper and a plan in mind, you’re ready to start the registration process. These eight steps will help you iron out logistics and prepare everything for submission to Companies House.
1. Choose a business structure
First, to determine your internal hierarchy and which laws you’ll have to follow, you need to choose a business structure:
- Private limited company (LTD): An LTD in the U.K. offers owners limited liability and separate legal status. It makes the organization a separate legal entity, meaning that the company—not its owners—is responsible for debts and other obligations. The owner’s personal assets aren’t wrapped up in the business, and their liability is limited to the value of their shares. LTDs are the most common business structure in the U.K.
- Public limited company (PLC): A PLC is very similar to public corporations in the U.S. The company can sell shares to the public, but this comes with more onerous capital and reporting requirements. Owners share the same limited liability as an LTD.
- Limited liability partnership (LLP): This structure combines the flexibility of a partnership with limited liability protection, so partners are only responsible for what they put into the business, not the other partners’ debts.
- Sole trader: Everything falls on the owner’s shoulders in a sole trader structure. The setup requires jumping through fewer hoops, but the sole owner is responsible for all the company’s debts as their own.
2. Check and register your company name
Pick a unique business name that meets Companies House guidelines. To protect your brand, consider registering your company’s name as a trademark to give yourself a legal claim over the name. Trademark registration costs £170 online or £200 by mail.
3. Provide a registered office address
This step is easy: Include your registered office address on your application. This appears on the public record, and is simple (and free) to update with Companies House when you move offices.
4. Appoint directors and identify people with significant control (PSC)
You must appoint a minimum of one director (who can be the owner) for your business. List any others with significant control or decision-making power—particularly those who have voting rights or own 25% or more of shares—on your application. They are people with significant control (PSC) or “beneficial owners.” Providing this information tells Companies House who is in charge of the organization when they have questions or need to follow up on something.
5. Prepare and submit your memorandum and articles of association
The memorandum is a legal document that’s automatically generated by Companies House when you form a company in the U.K. It confirms the shareholders’ intent to start (and be involved in) the business, and the people and information on it can’t be changed after incorporation.
The articles of association are roughly equivalent to bylaws for companies in the United States: an internal guide to running the business. The articles break down power structures and other important details, like shareholder rights, how power is split between directors, and an outline of the decision-making process. While you can create your own articles of association, most businesses use Companies House’s standard model articles, which are available online.
6. Obtain your SIC code
A standard industrial classification (SIC) code classifies the nature of your business’s activity for statistical and regulatory purposes. These codes are highly specific—there are different SIC codes for farms growing cereal grains versus wheat, for example—and you must select at least one relevant five-digit code from the official Companies House list.
7. Submit the registration form to Companies House
Once your application is complete, you can submit it online through Companies House’s Web Incorporation Service or via postal mail. Make sure your paperwork includes all the required details from the previous steps, or it may take longer to process your registration. Putting the envelope in the mail or clicking “submit” completes your official incorporation, moving your business one step closer to legal recognition in the U.K.
Approval can take anywhere from a few hours to two business weeks depending on your submission method and the number of other applications Companies House is processing. Most businesses are registered within 24 hours, even if you’re applying from outside of the U.K.
If you’re registering as a sole trader, you can start trading as soon as you’ve submitted the paperwork, regardless of registration status. LTDs must wait until Companies House has given their stamp of approval to start doing business.
8. Register for necessary taxes
After incorporation, there are three tax systems you may need to set up for international tax compliance: Corporation Tax, Pay As You Earn (PAYE), and value added tax (VAT). Everyone must register with His Majesty's Revenue and Customs (HMRC) for Corporation Tax within three months of starting a business. If you plan to hire employees, you’ll need to set up Pay As You Earn (PAYE) for your payroll process. And if your taxable revenue exceeds the value added tax (VAT) threshold, which is £90,000 in 2025, you must register for VAT.
The cost of registering a company in the U.K.
How much you’ll have to pay for registration varies depending on how you submit your application:
- £50: Online registration via Companies House, typically with a 24-hour processing time
- £71: Registration with Companies House through the mail, generally with an eight to 10 business day turnaround
- £78: Same-day registration service using a digital software agent
The cost of registration is typically not tax-deductible, but can be reimbursed by the business.
Exploring free and paid company registration options
No matter how you register, you’ll have to pay at least £50 through Companies House. You’ll have the option to choose between doing it yourself and going through a third party, which is one way you might save some time or money.
Registering yourself
When you register your business yourself, you have full control of the process. It’s relatively inexpensive and moves quickly, especially if you register online. However, you won’t have support from people familiar with the process, which could increase the risk of errors and, in turn, penalties.
Through a formation agent
A formation agent is a person or firm who specializes in registering companies in the U.K. They can provide legal templates, help open a business bank account, and act as a general point person for support during and after incorporation. But you get what you pay for: This option tends to be more costly, ranging from £50 to £200 (or more), depending on the services you need.
Employers of record (EORs)
If you’re looking to tap into British talent, working with an employer of record (EOR) in the U.K. can be an alternative to registering a company, eliminating the expenses and time it takes to set up a local legal entity. EORs act as legal employers in dozens of countries, helping business owners compliantly onboard talent across the globe.
Hire in the U.K. compliantly with Oyster
If the particulars of how to open an LTD company in the U.K. are more than you can take on yourself, let Oyster help. As your EOR partner, Oyster enables you to onboard talent in the U.K. by handling everything from U.K.-specific payroll and benefits to compliance, while you maintain day-to-day control of your team members. Oyster acts as the legal employer on your behalf, streamlining the process of expanding or starting your business in the U.K.
Learn about Oyster’s EOR services today.
About Oyster
Oyster is a global employment platform designed to enable visionary HR leaders to find, engage, pay, manage, develop, and take care of a thriving distributed workforce. Oyster lets growing companies give valued international team members the experience they deserve, without the usual headaches and expense.
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