How to set up a limited company step by step

Last reviewed: 29 September 2026 · Reviewed by IFM's qualified accountant

This guide covers the standard private-company route. Unusual ownership, regulated activity, investment terms, charities, community structures or complex articles need tailored legal and tax advice.

How do you check whether a company is the right structure?

A limited company is legally separate from the people who own and run it. That separation can support limited liability, shared ownership and continuity, but it creates public filing, director duties and rules for taking money out.

Compare the company with sole-trader, partnership and other structures before registering. Once contracts, assets and income begin in the company, reversing the decision can take more work than making a careful choice at the start.

Should the company be limited by shares or guarantee?

Most trading small companies are private companies limited by shares. Shareholders own shares and the company can distribute eligible profits through dividends under the legal rules.

A company limited by guarantee has guarantors rather than shareholders and is often used for membership or not-for-profit purposes. The structure alone does not create charitable status or remove tax obligations.

Choose the form that matches ownership and purpose. Do not use a guarantee company merely because it appears simpler on a form.

Who can you appoint as a director?

A private company needs at least one director and does not have to appoint a company secretary. Directors are legally responsible for running the company, following its constitution, maintaining records and ensuring required information is filed.

Check that each proposed director can act. A disqualified person cannot act without the relevant court permission. Obtain the person's correct legal details, service address and usual residential address.

New directors need to verify their identity for Companies House and use their personal code in the appointment or incorporation process. The code belongs to the person, not the company.

How should you decide who owns the company?

A company limited by shares needs at least one shareholder, who can also be a director. Decide:

who will own shares;
how many shares will be issued;
their nominal value;
whether there will be more than one class; and
what voting, dividend and capital rights are intended.

A simple equal split can create deadlock where two owners later disagree. Different share classes and investor rights can have legal and tax consequences. Obtain advice before using a structure you do not fully understand.

For a company limited by guarantee, identify at least one guarantor and the guaranteed amount.

Who counts as a person with significant control?

The company must identify its people with significant control, known as PSCs. This can include someone with more than 25% of shares or voting rights, the right to appoint or remove a majority of the board, or other significant influence or control.

Ownership through another entity can make the analysis more involved. Record the basis on which each person or registrable legal entity is included.

PSCs have identity-verification responsibilities as well as directors. The timetable for connecting a verified identity to the PSC role depends on the circumstances.

How do you choose a compliant company name?

Check the Companies House register and UK trade marks. Incorporation does not grant a right to use a name that infringes another person's trade mark or passes the business off as connected with them.

Company-name rules restrict some words, expressions and similarities. A sensitive word or an implication of connection with government or a public authority can require permission.

Also check a practical web domain and social identifiers. A legal company name and trading name can differ, but disclosure rules still require the registered name and company details on business letters, order forms and websites.

What registered office and email should you use?

The registered office must be a physical, appropriate address in the same UK jurisdiction in which the company is registered. Someone must be made aware of delivered post, and a sender must be able to obtain acknowledgement of delivery. A Royal Mail PO Box on its own is not accepted.

The registered office is public. If privacy matters, have an alternative address in place before registering and obtain permission to use it.

The company also provides a registered email address. Companies House uses it for contact but does not place it on the public register. It must be monitored.

Directors provide a public service address and a private usual residential address. They can use the registered office as the service address if suitable.

Which constitutional documents are needed?

The formation requires a memorandum of association, articles of association and either a statement of capital and initial shareholdings or a statement of guarantee.

Standard model articles may suit a straightforward company. They may not reflect arrangements between several founders, investors, family members or different share classes. A shareholders' agreement can address matters outside the public articles, but it should be prepared consistently with them.

How do you choose the right SIC code?

The Standard Industrial Classification code describes the company's intended activity. Select the code or codes that best match what the company will do. They can be updated later, including through the confirmation-statement process, but should not be chosen casually merely because another company uses them.

How do you register with Companies House?

The standard digital incorporation fee is £100 from 1 February 2026. A paper application costs £124 and normally takes longer. Fees can change, so check the current Companies House fee page before applying.

The application includes the directors, registered office, email, ownership, PSC information, lawful-purpose statement, identity-verification details and constitutional information. Check spelling and addresses carefully because much of the result becomes public.

When Companies House accepts the application, it issues the certificate of incorporation and company number. The company exists from that point.

What must you do immediately after incorporation?

Open company records and preserve the incorporation documents. Record the shareholders, directors, PSCs and share issue. Set up bookkeeping that separates company and personal money from the first transaction.

Open a company bank account and agree who can authorise payments. If a director pays a company cost personally, record it properly rather than losing the evidence.

Add Corporation Tax services to the business tax account when the company starts business activity and give HMRC the correct trading date. Consider PAYE before paying employees or directors and VAT when the registration rules or a voluntary decision apply.

Which first deadlines should you record?

The first Companies House accounts are generally due 21 months after incorporation. The first confirmation-statement review period normally ends 12 months after incorporation, with filing due within 14 days after the review period.

Corporation Tax periods cannot exceed 12 months, so a first set of accounts covering more than 12 months can need two Company Tax Returns and two payment dates.

Use the Deadline Finder for standard first accounts, first confirmation statement and Corporation Tax dates. For VAT, payroll, personal tax and other obligations, check the tax deadlines calendar and your official records.

Keep the incorporation submission, certificate and acceptance messages together. They provide the reference point for checking the first accounting period and resolving any difference between an internal calendar and the public register.

What should you read next?

What do people also ask about this topic?

How much does it cost to set up a limited company in 2026?

Companies House charges £100 for standard digital incorporation from 1 February 2026. Paper incorporation costs more and other professional, address or legal services may add fees. Check the live Companies House fee page before applying because statutory fees can change.

How long does it take to register a limited company?

A straightforward digital application is often processed quickly, but there is no guaranteed same-day outcome for every case. Name issues, identity verification, complex ownership or inaccurate details can delay registration. Do not sign contracts as the company until Companies House has incorporated it and issued the certificate.

Can one person set up a limited company?

Yes. A private company limited by shares can have one director and one shareholder, and the same person can hold both roles. The company still needs a registered office, registered email, share information, PSC details, records and continuing filings. The director remains legally responsible for compliance.

Can I use my home address for Companies House?

A qualifying home address can be used, but a registered office and director service address are public. The company must also supply the director’s usual residential address privately. If privacy matters, arrange a permitted alternative before incorporation rather than trying to remove a home address later.

Which official sources support this guide?

General guidance, not advice for your situation.