UK company registration, step by step

Most UK companies are limited by shares, and those words explain the appeal. The company is a legal entity owned by its shareholders. Limiting their liability to their shares protects their personal assets if the company runs into financial difficulty. The forms the Ltd is usually weighed against are not smaller versions of it. A sole trader, a limited liability partnership and a company limited by guarantee each differ from it in ownership or tax treatment. Choosing between them is a question of ownership and tax as much as of liability. For a business that will have shareholders and trade for profit, the Ltd is usually where that comparison ends.

The documents serve more than the registration form. A UK incorporation records the company's directors and its persons with significant control, its ultimate beneficial owners. The firms that handle incorporations and the banks that open company accounts work under anti-money-laundering rules. Each document has to be something they can verify, not merely something that is true. Where a company holds the shares, the question of who controls the UK company passes through that shareholder to the individuals behind it. Their documents therefore come into the file too.

The requirements in the panel are different in kind. The UK address keeps mattering once the company exists: the registered office is where official post is delivered. The registered office must be UK based; the directors do not have to be UK residents. The personal code entry is a different matter. A person receives the code after verifying their identity with Companies House. The entry asks whether the people involved have already done that. The usual misreading is the address itself: it is asked of the company, not a residence test for the people who run it.

Corporation Tax is a tax a new UK company meets early, because its registration with HMRC is part of setting the company up. The rates in the panel are not one figure applied to every company. Which one applies depends mainly on the profit of each accounting period. Between the two thresholds the rate is tapered rather than stepped. The main rate is not automatically what a young company pays. The detail most often misread is the calendar. Filing the return and paying the tax run on separate deadlines. The date by which the return is due does not tell you when the tax itself has to be paid.