How much does it cost to set up a UK limited company?

The Companies House filing fee is £50 online. Using a formation service typically adds another £30-£100 to handle paperwork, registered address, and basic compliance setup. Total cost: £50-£150 to get incorporated. Annual costs once running are around £200-£400 for accounts and corporation tax filings, plus accountant fees if you use one.

How long does it take to incorporate a limited company?

Online incorporation through Companies House is usually completed in under 24 hours, sometimes within a few hours. Formation services can match this. Postal applications take 8-10 working days. Once incorporated, you receive a certificate of incorporation, company number, and unique taxpayer reference (UTR) automatically.

Can I use my home address as the registered office?

Yes, but it becomes public record on Companies House. Anyone can search for it. Many formation services offer a registered office address (their address) for around £50-£100 per year, which keeps your home address private. Worth considering particularly if you'll be visible to customers.

What's an SIC code and which one do I pick?

Standard Industrial Classification codes describe what your company does. You pick one (or up to four) during incorporation. There's a list on the Companies House website; pick the closest match. Don't agonise — the code is used for statistical purposes and doesn't restrict what the company can actually do.

Setting Up a Limited Company After Leaving Work (UK 2026)

The four decisions before you incorporate

1. The company name

The name has to be unique on the Companies House register and can’t be too similar to an existing one. Check the Companies House name availability checker before committing. Restricted words (Royal, British, Bank, Chartered, etc.) require additional approval. The name has to end in “Limited” or “Ltd” (English/Scottish) or “Cyfyngedig” or “Cyf” (Welsh).

Many founders use a holding-style name (e.g. their initials plus “Consulting”) for flexibility, then trade under a brand name. The trading name doesn’t have to match the company name as long as the company name appears on invoices, the website footer, and other formal places.

2. The registered office address

The registered office is the legal address of the company where official mail is sent (Companies House correspondence, HMRC notices, court papers). It becomes public on the Companies House register and is searchable by anyone.

Options: your home address (free but public), a registered office service from a formation provider (£50-£100/year, keeps your home address private), a virtual office service (£100-£300/year, with mail forwarding), or a serviced office if you have one. For most one-person businesses, a registered office service is the right balance of cost and privacy.

3. The share structure

For a single founder, the standard structure is 1-100 ordinary £1 shares, all held by the founder. The total number doesn’t matter much (it’s arbitrary); 100 is convenient because percentages map directly to share counts. You allot the shares to yourself at incorporation, becoming the sole director and shareholder.

For two co-founders, 100 shares split 50/50 or 60/40 are typical. For more complex structures (investors, employee share schemes, multiple share classes), get advice before incorporation; restructuring share classes later costs more.

4. The SIC code

The Standard Industrial Classification code describes what the company does. There’s a list of about 800 codes on the Companies House website. Pick the closest match; the code is mainly statistical and doesn’t restrict what you can do. You can change it later by amending your confirmation statement. Common codes for new consulting/contracting companies: 70229 (other management consultancy), 62012 (business and domestic software development), 73110 (advertising agencies).

The incorporation process step by step

Online at Companies House: pay the £50 fee, complete the IN01 form (name, address, directors, shareholders, SIC code), submit. Confirmation usually arrives within 24 hours along with your certificate of incorporation, company number, and memorandum and articles of association. HMRC is automatically notified and opens your corporation tax record.

Through a formation service: provide the same information via their form, they file with Companies House on your behalf, and they typically bundle additional services (registered office address, first-year company secretary, basic compliance setup, sometimes a business bank account referral). The £50 fee is included in their package price.

What to set up after incorporation

Within the first week: a business bank account (most challenger banks open one in 1-3 days), an accountant (specialist contractor/freelance accountants charge £80-£150/month and handle everything), a basic accounting software setup (FreeAgent, Xero, or QuickBooks; often bundled by the accountant), and corporation tax registration confirmation from HMRC (arrives automatically by post within 14 days).

Within the first month: company stationery (basic letterhead template, invoice template), a website if appropriate (even a one-page placeholder), and an idea of your VAT position (mandatory registration above £90,000 turnover, voluntary below).

Common mistakes

The recurring ones: making the company name too narrow (“Acme Plumbing Ltd” if you might later expand to electrics), using your home address as the registered office without realising it becomes public, picking an excessively complex share structure for a one-person business, forgetting to register for VAT when you cross the threshold (penalties apply for late registration), and not opening a separate business bank account (HMRC can require it, and mixing personal and business money makes accounting much harder).

Frequently asked questions

How much does it cost to set up a UK limited company?: The Companies House filing fee is £50 online. Using a formation service typically adds another £30-£100 to handle paperwork, registered address, and basic compliance setup. Total cost: £50-£150 to get incorporated. Annual costs once running are around £200-£400 for accounts and corporation tax filings, plus accountant fees if you use one.
How long does it take to incorporate a limited company?: Online incorporation through Companies House is usually completed in under 24 hours, sometimes within a few hours. Formation services can match this. Postal applications take 8-10 working days. Once incorporated, you receive a certificate of incorporation, company number, and unique taxpayer reference (UTR) automatically.
Can I use my home address as the registered office?: Yes, but it becomes public record on Companies House. Anyone can search for it. Many formation services offer a registered office address (their address) for around £50-£100 per year, which keeps your home address private. Worth considering particularly if you'll be visible to customers.
What's an SIC code and which one do I pick?: Standard Industrial Classification codes describe what your company does. You pick one (or up to four) during incorporation. There's a list on the Companies House website; pick the closest match. Don't agonise — the code is used for statistical purposes and doesn't restrict what the company can actually do.

General information about UK company formation. For tax and legal questions specific to your circumstances, contact an accountant or solicitor.

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Setting up a limited company after leaving work