It is exciting that you decided to register your business name. You are taking an important step as it is the first point of contact with your company. It is unique and represents the services a company provides. This article is a guide on how to register a business name in the UK and the types of businesses.
The process of registering may seem complex and daunting. By following the right steps and procedures, you can simplify it.
Types of Business Categories
When you are creating the name of your business, decide on the type you would like to start a business.
Have a look at the two types of businesses.
1. Sole Trader Business
As the owner of a sole trader business, you are not legally bound to register your name with Companies House. Nevertheless, you must register with HMRC. You can then pay tax through the self-assessment system.
Remember, you can use your own name or the name of the company. It is best to stick to the rules. Please note that you cannot use the following:
- limited liability company
- public limited liability
This includes their respective acronyms in the business name with this type.
2. Business Partnership
If you are registering a partnership business, it involves sharing the responsibilities of the business.
The rules and regulations do not change for business partnerships. You appoint a partner to manage the tax affairs of the businesses. They register the partnership with HMRC for self-assessment. You must include the names of all your partners in any documentation process related to the partnership. Therefore, you should learn how to register a business name in the UK.
Adhere to the processes to register a business partnership. Expanding an existing company requires registering it as an overseas company.
How to Register a Business Name in the UK 2023
There is no denying the reality that it requires well-thought planning before starting a business. You may be curious that how you can register the name of your business appropriately.
For a limited liability partnership and a limited liability company, you must register it with the registrar.
Companies House has a list of all the sensitive words and expressions that you cannot use. Before submitting the name of the business, make sure it does not contain any words from that list. Certain names like royalty (such as duke or king), require applying for permission from the concerned authorities. If you are living in England or Northern Ireland, apply to the Ministry of Justice. Whereas, if you are living in Wales or Scotland, apply to the government.
Following is a step-by-step process to explain how to register a business name in the UK.
The first step is to decide the name of your company. Selecting the name of the company is somehow technical and tricky. There are certain rules and regulations to follow while selecting the name of your company. Please follow them so Companies House does not reject your submission. If you don’t follow the regulations, your entire process of submission will be rejected. Then, you will have to start all over again. You must comprehend how to register a business name in the UK.
I. Company Address
Once you have selected an appropriate and impressive name representing a better image of your company. The next step is to choose an official address for your company. Your official address is where you receive notifications and emails for your business. Do not use your personal home address for security reasons. It makes your home public, and anyone can access it easily. Another feasible option you have is to use the accountant’s address instead of your home address.
II. Choose a SIC Code
SIC stands for Standard Industrial Classification of economic activities. This code represents exactly the business your company participates in. This is a five-digit code that represents specific industries and their classifications. An example of the SIC code is 11050. The first two digits represent that it is a beverage manufacturing company. While the final three digits indicate that the beverage is a beer. SIC code varies from company to company. If your company has different specifications, your company can have up to four SIC codes.
III. Appointment of a Company Director
Every company needs a responsible person to run the business and prepare the reports and accounts and other relevant tasks. That person is the director of the company. It does not mean you necessarily have to appoint someone else, but you can appoint yourself as a director of the Company. If you don’t appoint yourself as the director of the company, then it is legally mandatory to appoint a director and whoever you appoint must be over 16 years of age. At this stage, you can also choose a secretary for the company, and it is optional. You can if you wish.
You are required to give two addresses of the director, one official business address and the other residential address. These addresses are not open to the public. Provide an alternative residential address if you are the director of the company and have already given the home address as the company address.
IV. Share Structure of the Company
If the status of your company is a limited liability company, then you are required to provide the numbers of the shares. A share indicates a portion of the company and shareholders’ own shares. It means that you are the owner of the part of the shares of the company and have an entitlement to a proportion of the profits, depending on the number of your shares. It is also one prerequisite to specify the number of shares for the registration of your company.
You can give any value to shares and assign the rights to shareholders. You also have the option to become the sole owner of the company by choosing to have a single share and assign a value of £1 to it. If you are the sole owner, you will have exclusive power over your company.
Later, you can change the number of shares, values, and rights associated with it whenever you want to have shareholders. It is important to stay updated on how to register a business name in the UK.
V. Status, Percentage, and Rights of the Shareholders
When shareholders become part of the company, they become entitled to profits. They also have voting rights in the management, administration, and planning of the company. A shareholder having more than 25% shares of the company is legally qualified to have significant control over the matters of the company. You must provide the details of the shareholders and persons of significant control. The details include names, date of birth, country of residence, nationality, service address, home address. As well as the degree of control they have over the matters of the company.
VI. Statement of Compliance
Registration of the name of the company is a legal operation. Therefore, you must ensure obedience and strict adherence to the rules and regulations of the Companies House.
VII. Company Formation Fee
Once you have successfully finished registering the name of the business at Company House, then you pay the fee. The fee is £12 if you applied through the online registration process and if you are doing it by post, then the fee is £40. It can take up to 10 days to receive a response. You can also opt for the same-day registration option for a fee of £100, but this option is only then possible if you complete your registration process before 3 p.m.
That concludes all the steps on how to register a business name in the UK.
How Can you Know the Companies House Rejected Your Proposal
Companies House, within 24 hours, approves or rejects the business name. If your business name gets approval from the Companies House, then you can open a business bank account and register the company for corporate tax. Disclaimer: Please note that none of the organizations, companies, or institutions mentioned in this article are affiliated with us.
Disclaimer: Please note that none of the organizations, companies, or institutions mentioned in this article are affiliated with us.