Different types of business model require different approaches when it comes to the rules (and the benefits) of formal registration. In many cases, the rules on registration are mandatory, and failure to comply with them can incur quite hefty financial penalties, as well as operating constraints.
We’ve summarised the requirements for you here. If you’re considering setting up any one of these models, take a look at our guide titled, Which business model is right for you?.
Sole traders need to register with HMRC for self-assessment for tax purposes, but they don’t need to register anything about their business operations with Companies House.
Limited companies must be registered with Companies House.
This can be done either:
• Online, which costs £12 and means your company will usually be incorporated within 24 hours - you will need to register your email address and choose a password if you have never used online filing (WebFiling) with Companies House before, and this email address and password can then be used for all future WebFiling. This method is generally the fastest and cheapest option, and therefore what we would recommend if you want to incorporate yourself. You can pay for the incorporation with a credit/debit card.
Please note that if you incorporate your company online, you will only be able to incorporate the company with the ‘model articles of association’. The model articles constitute the default provisions for companies limited by shares incorporated on or after 1 October 2009, but may not necessarily be completely suitable for your company. If you would prefer to put in place bespoke articles, then you will have to adopt these after the company has been incorporated by passing a special resolution of the shareholders, or alternatively use the paper filing method of incorporation described below.
The memorandum of association is automatically populated for you from the information you provide about the company’s shareholders when you incorporate online. The memorandum states that the initial shareholders wish to form a company and have agreed to become members and take at least one share each.
• By filling in Form IN01, printing it out and sending it to Companies House by post along with the articles of association and signed memorandum of association of the company. If you use the paper filing method, then you are free to adopt completely bespoke articles, although you can still adopt the model articles if you wish. This service costs £40 (you should include a cheque for this amount when you send the form) and usually takes 8–10 days – or you can pay £100 to be registered on the same day that Companies House receives your documents.
• By using a formation agent, solicitor or accountant who will take care of the registration process for you for a fee. One of our experts would gladly take care of this for you, and can assist you with drafting bespoke articles of association if you require them.
Partnerships must register with HMRC for tax purposes, but they don’t need to register their partnership with Companies House.
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