Both United Kingdom citizens and Citizens of other countries can register a business in the UK, even if they’re not UK residents.Most businesses register in UK are either as a sole trader, limited company or partnership
Weather you into Online businesses or brick-and-mortar businesses you may need to register your business in United kingdom depends on your type of business which could be a sole trader, limited company or partnership.However, If you’re a sole trader, registering a business name isn’t actually compulsory
If you’re self-employed and earning more than £1,000 a year, you will have to register with HMRC as a sole trader that you pay tax through Self Assessment. You’ll need to file a tax return every year.. but If your annual profit is over £30,000, you’ll have to register as a limited company.
Also read:How to register a business name in New Zealand
Steps on to Register/ set up a Business in the UK
Different business in UK has different registration requirements to Set up a business for the purpose of the article we shall take a look at Register your business as Sole traders,Limited companies and Partnerships
Sole traders
As a sole trader, you run your own business as an individual and are self-employed. that means you keep all your business’s profits after tax also you are responsible for any losses your business makes
To set up as a sole trader, you need to tell HMRC that you pay tax through Self Assessment. Also you need to prove you’re self-employed, for example to claim Tax-Free Childcare You’ll need to file a tax return every year.
You must register for VAT if your turnover is over £85,000. You can register voluntarily if it suits your business,When Choosing your business name you must not: include ‘limited’, ‘Ltd’, ‘limited liability partnership’, ‘LLP’, ‘public limited company’ or ‘plc’
Your name also cannot contain a ‘sensitive’ word or expression, or suggest a connection with government or local authorities, unless you get permission.
Limited companies
Limited Companies in the UK must be registered with Companies House and include the suffix “Ltd” or the word “Limited” at the end of their name. It could be limited by shares’ or ‘limited by guarantee’
Limited by shares means that it’s a for-profit company that’s legally separate from its owners. The company has shares and shareholders and can keep the profits it makes after paying taxes. This means the company:
1.is legally separate from the people who run it
2. has separate finances from your personal ones
3.has shares and shareholders
4.can keep any profits it makes after paying tax
Limited by guarantee is legally separate from the owners, but instead of shareholders it has guarantors and any profits earned are reinvested into the company. Limited by guarantee companies are usually ‘not for profit’. This means the company:
1.is legally separate from the people who run it
2. has separate finances from your personal ones
3. has guarantors and a ‘guaranteed amount’
4. invests profits it makes back into the company
There are two types of limited companies in the UK:
Private limited company (Ltd.): A private limited company is registered at Companies House and must have at least one director and one shareholder.
Public limited company (PLC): has directors and shareholders, but the difference is that the shares can be publicly traded. This gives the company the ability to raise funds more easily from stock market.In order to become a public limited company in UK, the company must have issued shares with a value of at least £50,000 to the public.
Read: How to register a business in Canada -What you need to know
Partnerships
A partnership is the simplest way for 2 or more people to run a business together.Partners share the business’s profits, and each partner pays tax on their share. A partner does not have to be an actual person. For example, a limited company counts as a ‘legal person’ and can also be a partner.
When you set up a business partnership you need to:
choose a name
choose a ‘nominated partner’
register with HM Revenue and Customs (HMRC)
The ‘nominated partner’ is responsible for managing the partnership’s tax returns and keeping business records.You can also register the partnership using form SA400 if you cannot register online. You can register as a partner using form SA401.
Registering for VAT
You must also register for VAT if your VAT taxable turnover is more than £85,000. You can choose to register if it’s below this, for example to reclaim VAT on business supplies
How to Set up a limited company:
To set up a limited company, appoint directors and shareholders or guarantors, and register for tax. you need to get the follow details handy.
1. Check if you should set up as one of the following instead:
self-employed (‘sole trader’)
a business partnership
a social enterprise
an overseas company
an unincorporated association
2. Check if the name you want is available also Check existing trade marks
3,You must appoint a director but you do not have to appoint a company secretary.
4.You need at least one shareholder or guarantor, who can be a director.
5.You need to prepare a ‘memorandum of association’ and ‘articles of association’.
6,Check the company and accounting records you must keep
7.You’ll need to register an official address and choose a SIC code – this identifies what your company does. can register for Corporation Tax at the same time as registering with Companies House.
If you cannot, register separately with HM Revenue and Customs (HMRC) after you’ve registered your company with Companies House.
Register your company in UK
You can set up a private limited UK company online in just 24 hours, or register a branch of your existing company in up to 4 weeks.Before you start the incorporation process, you’ll need:
a name for the company
an address for the company – this can be any UK address
at least one director – this person does not need to be a UK resident
at least one shareholder – this can be an individual or another company
You’ll get a ‘certificate of incorporation’. This confirms the company legally exists and shows the company number and date of formation.
You’ll need at least 3 pieces of personal information about yourself and your shareholders or guarantors, for example:
town of birth
mother’s maiden name
father’s first name
telephone number
national insurance number
passport number
It costs £12 and can be paid by debit or credit card. Your company is usually registered within 24 hours.
