The limited liability company is the most popular business structure to trade under in the UK besides sole trading. In these cases, the liability of company directors is ‘limited’, so the director’s personal finances are separate from their business ones. This means that if the company goes into debt, the company shareholders will not be liable for them.

There are many benefits of setting up a limited company, but it can seem overwhelming for new founders. This article helps to explain the main considerations that you should take when registering your limited company.

Naming

“The name of your company must be unique and cannot be identical or similar to an existing company name,” explains Andrew Speer, Director at Tudor Lodge Digital, a marketing agency.

“It is important to choose a name that is memorable and represents your business well as it can be costly to change it later down the line.”

“When choosing a company name, you should also consider any potential trademark or domain name conflicts. You should conduct a trademark search to ensure that the name you choose is not already registered as a trademark by another company. You should also check the availability of the domain name to ensure that it is available to register.”

You can check the availability of a company name by searching the Companies House register. This will allow you to see if the name you want to use is already registered to another company. You can also use the Companies House name availability checker, which will allow you to check the availability of a name in real-time.

Address

All limited companies must have a registered office address. This is the place where official paperwork is delivered, and that appears on the public record.

If you are running your business from out of your home, you have the option to pay an annual fee to companies that will allow you to use their address instead, for your privacy. Directors can provide this service address on their individual entry, protecting their residential addresses from being shared on a public register.

Shareholders

Limited companies are required to have at least one shareholder or guarantor. You can discuss this with your accountant, who can advise you on the tax implications of this. You should also consider writing up a shareholders’ agreement.

You must inform Companies House about the individuals or companies who have a significant degree of control over a company (anyone who owns 25% or more of share capital). You must disclose this information during incorporation. If more shareholders are added, you are obligated to update this information.

Documents

You need the following documents to register your business with Companies House:

• Memorandum of Association: Names and addresses of those involved in your company. This will be done automatically if you apply online.
• Articles of Association: This outlines the directors’ powers, shareholders’ rights, etc. Companies House has ‘model’ articles that most limited companies choose to adopt.
• Form IN01: This form includes information such as the directors, the registered address, the company’s name, details of shareholders, etc. This information is automatically captured in the online application.

Registering

Before you start trading as a limited company, you must register your company online at the Companies House website. You will need to provide information such as the company name, registered office address, and details of the company’s directors and shareholders.

It costs £12.00 to do this online using the application form IN01 with the Web Incorporation Service. Most applications are processed within around 24-48 hours. You also have the option of using a formation agent or an accountant to help you out with this step.