How to Set Up a Limited Company in the UK (2026 Guide)

To set up a limited company in the UK, verify every director's identity with Companies House, choose a name, a UK registered office and up to four SIC codes, decide the shares and shareholders, then register online for £100. Companies House usually registers the company within 24 hours. This guide walks through each step in the order that actually works in 2026, and what it costs in year one and year two.

What Is a Limited Company?

A private limited company is a business that is legally separate from the people who own and run it. The company owns its assets, signs its contracts and owes its debts. Shareholders own the company and their liability is limited to what they paid, or agreed to pay, for their shares. Directors run it and have legal duties under the Companies Act 2006. One person can be both the only director and the only shareholder.

A company is created when Companies House registers it and issues a certificate of incorporation. From then on it is on the public register, with its name, number, registered office, directors and people with significant control.

Is a Limited Company Right for You?

Why people choose a limited company

• Limited liability. Business debts are normally the company's, not yours, unless you give a personal guarantee or break the rules as a director.
• A separate legal entity. The company can own property, hold contracts and outlive its founders.
• Credibility. Some clients, platforms and agencies only work with limited companies.
• Ownership you can share. Shares make it straightforward to bring in co-founders or investors.

The honest disadvantages

• More administration. Annual accounts, a confirmation statement, a Corporation Tax return and a register of members, with deadlines and penalties.
• Less privacy. Directors' names, month and year of birth and service addresses, and the registered office, are public.
• Directors' duties. You must act in the company's interests, keep proper records and verify your identity with Companies House.
• Taking money out has rules. Money belongs to the company; you pay yourself through salary or dividends. Most owners use an accountant.

If you are unsure whether a company or sole trader suits your income and plans, speak to an accountant before you register.

Types of Company You Can Set Up

This guide covers the private company limited by shares, which is what most people mean by a limited company.

How to Set Up a Limited Company: Step by Step

Step 1: Verify every director's identity first

Most guides leave this until last, but it now comes first. Since 18 November 2025 Companies House will not register a company unless every individual director has verified their identity, and the application must include each director's 11-character personal code. Anyone with more than 25% of the shares (a person with significant control) must verify too, at incorporation or within 14 days of it.

You can verify through GOV.UK One Login, which works best with a biometric passport and a phone that can read its chip, or through an Authorised Corporate Service Provider (ACSP). If one co-founder is slow, the whole company waits. The details are in identity verification when forming a company, and PSC verification explained covers shareholders.

Step 2: Choose a company name

The name must end in “Limited” or “Ltd”, must not be the same as a name already on the register, and must not include sensitive words such as “Royal” or “Bank” without approval. Check it with our free company name checker. A name you can register may still clash with a trade mark, so search the trade mark register too.

Step 3: Choose a registered office address

Every company needs a registered office in the UK, in the same part of the UK where it is registered (England and Wales, Scotland or Northern Ireland). It must be an appropriate address where post comes to the attention of someone acting for the company. A PO Box is not allowed. The address is public, so many founders use a registered office address service rather than their home. See registered office address rules for the details.

Step 4: Give a registered email address

Companies House needs an email address where its messages will reach someone acting for the company. It is not shown on the public register.

Step 5: Choose up to four SIC codes

SIC codes describe what the company does. Only codes on the Companies House condensed list are accepted. Search them in plain words with the SIC code finder.

Step 6: Decide the shares and shareholders

Most small companies issue 100 ordinary shares of £1 each, so percentages are easy to read. The nominal value is what each shareholder agrees to pay for their shares; it is not a fee. Record anyone holding more than 25% as a person with significant control.

Step 7: Appoint at least one director

A director must be a real person aged 16 or over and not disqualified. Each director gives a public service address and a usual residential address, which Companies House keeps private, plus their personal code. A company secretary is optional for a private company.

Step 8: Articles of association

The articles set the company's internal rules. Most small companies use the model articles, which you can adopt during an online application without drafting anything.

Step 9: Register with Companies House

Register online through GOV.UK or through a formation agent for £100; Companies House usually registers online applications within 24 hours. By post, form IN01 costs £124 and takes 8 to 10 days. The subscribers confirm the company is being formed for a lawful purpose.

Step 10: After registration

• Certificate of incorporation. Proof the company exists, with its company number.
• Corporation Tax. Register with HMRC within 3 months of starting to do business.
• Business bank account. Keep the company's money separate from yours. Each bank or provider makes its own checks.
• PAYE and VAT. Register for PAYE before you first pay anyone through payroll, including yourself as a director. Register for VAT if taxable turnover goes over £90,000, or earlier if you choose to.
• Deadlines. First accounts are due 21 months after incorporation. A confirmation statement is due within 14 days after the end of each 12-month review period.

How Long It Really Takes

The detail, including what delays an application, is in how long it takes to register a company.

In practice, plan for two to five business days from deciding to set up to holding your certificate, longer if a document needs replacing or a co-founder is slow to verify.

What It Costs in Year One and Year Two

For worked totals by situation, see what it costs to set up a limited company; to compare providers, see the best company formation agents. Founders abroad should also read about a UK business bank account for non-residents.

Fees from GOV.UK Companies House fees. See all packages on UK company formation.

Best Practices

• Verify every director before you finalise the application, so nothing waits on one person.
• Enter names exactly as they appear on each person's verified identity document.
• Use a registered office you control or a service that confirms your right to use the address.
• Pick SIC codes that match what you will actually do; you can change them later.
• Diary the first accounts, confirmation statement and Corporation Tax deadlines on day one.

Common Mistakes

• Leaving identity verification to the end. The application cannot be completed without each director's personal code.
• Using a home address without realising it is public. A registered office cannot be removed from the register while it is still in use.
• Choosing a name that is too close to an existing one or that contains a sensitive word.
• Forgetting the people with significant control or recording the wrong shareholdings.
• Missing the 3-month Corporation Tax registration after the company starts trading.

Your Options

• Register directly with Companies House for £100, after verifying each director yourself and providing your own registered office.
• Use a formation provider. CorpAssist packages start at £159.99 including the Companies House fee. A person checks your name, shares and details before filing, and each director's identity verification is arranged in the same order through our Companies House-registered ACSP partner.
• Living outside the UK? See company formation for non-residents, with country guides for India, Pakistan, Nigeria and the UAE.

Already appointed to an existing company? See identity verification for new directors.

Frequently Asked Questions

CorpAssist is an independent commercial service and is not Companies House or GOV.UK. Fees and rules checked against GOV.UK on 24 October 2026.