Steps to Start a Business in UK

Establishing a business in UK is attractive for most entrepreneurs, thanks to its diverse opportunities, flexible commercial environment, and access to the European market.

Starting your own venture is easier than you might think.
While it’s not an overly complicated process, it’s important to follow the correct steps to ensure compliance with local laws and regulations. This detailed guide will walk you through the process.

Follow these steps to set up your company.

Initial Steps to Start a Business in UK

Step 1: Choose the Type of Company You Want to Set Up

First, determine the structure that best suits your goals. The most common options are:

Sole Trader: Ideal if you want to operate independently and retain full control over your income.
Limited Company: The most popular model, offering the benefit of creating a separate legal entity.
Partnership (LP or LLP): Best suited for those starting out with partners. You can choose between a Limited Partnership or a Limited Liability Partnership.
Branch: If you already operate abroad, you can establish a branch office.

Step 2: Choose Your Company Name

Next, select a name for your enterprise that complies with Companies House regulations:

It must be unique and not already registered.
It should not contain restricted terms unless officially authorized.
It must avoid offensive or misleading words.

You can check name availability on the official Companies House website. We also recommend choosing a name that clearly reflects your services and is easy to remember.

Step 3: Register Your Company with Companies House

If you opt for a Limited Company or a Partnership, you’ll need to register it with Companies House. You will need to provide:

Basic company information: name, address, and type of activity;
Director(s) and shareholder(s) details: names and addresses;
A clear description of your commercial activities to identify your sector and services.

Registration can be completed online for around £12. Once approved, you’ll receive your company registration number, making your business official.

Step 4: Tax Registration and Fiscal Responsibilities in the UK

Every enterprise must be registered with HM Revenue & Customs (HMRC) and meet its tax obligations:

Corporation Tax: A standard rate of 19% on profits, though this may vary.
VAT: If your annual turnover exceeds £85,000, VAT registration and charges are mandatory.

Additionally, if you hire staff, they must be registered for National Insurance, and you must handle payroll taxes and contributions.

Step 5: Open a Business Bank Account in the UK

To manage finances, a dedicated company bank account is necessary. Most banks will request:

Company registration number;
Company address;
Director and shareholder details;
ID and proof of address of the account holder.

Step 6: Obtain Business Insurance in the UK

Insurance protects your company from unforeseen events and helps build trust with clients and employees. Common types include:

Public Liability Insurance: Covers third-party damages in the workplace;
Professional Indemnity Insurance: Protects against negligence or professional errors;
Employers’ Liability Insurance: Mandatory if you employ staff, covering workplace incident claims.

Step 7: Comply with UK Regulations

Each industry has its own regulatory requirements. Ensure compliance with employment law, health and safety rules, and data protection regulations.

Companies must also file annual reports and financial statements with Companies House and meet HMRC tax obligations.

For help navigating these steps, Max Sociedades offers expert guidance and full management services.

Conclusion

Establishing your own enterprise is entirely achievable. However, following each step carefully is essential to build a solid legal and operational foundation.

By completing these steps, you can set your company up for success.

If you need further advice on launching your enterprise, feel free to reach out to us.