Registering a company with Companies House is quick and the filing fee is modest — check their site for the current figure, since it changes. The registration is not the part worth thinking about.
First: do you need one at all?
You can trade as a sole trader without registering anything, and many people should. A limited company brings separate legal identity and limited liability, and it brings annual accounts, a confirmation statement, director duties and a public record.
It is usually worth it when you have real liability to limit, when customers require it, or past a level of profit where it becomes tax-efficient. It is usually not worth it when you are testing whether an idea earns anything.
An accountant will answer this in one conversation, which is cheaper than a year of filings for a company you did not need.
Second: your address becomes public
A company's registered office and its directors' service addresses appear on a public register that anyone can search. If you register from home, your home address is what appears.
There are lawful ways to avoid that — a registered office service is the usual one — but they have to be arranged at registration. Changing it later is possible, but the earlier record does not vanish.
This catches out more people than anything else on this page, and it is worth deciding deliberately rather than by default.
Third: shares are easier to give than to take back
Two friends starting together, fifty-fifty, is the most common arrangement and the one that causes the most trouble later — when one leaves after three months and keeps half the company.
If more than one person is involved, agree in writing what happens when somebody leaves, before you file. A shareholders' agreement is not expensive and is far cheaper than the alternative.
What happens after, that nobody mentions
A registered company has obligations whether or not it trades:
- A confirmation statement, once a year.
- Annual accounts, even for a dormant company.
- Corporation tax, with its own registration and deadlines.
- PAYE, if you pay anyone including yourself as an employee.
- VAT, once you cross the registration threshold — check HMRC for the current one.
Late filing carries automatic penalties. This is the real cost of a company you did not need: not the fee, the year of admin.
What to have ready
The company name, the registered office address, the directors and their details, the shareholders and their split, and a description of what the business does. Have the share split agreed before you sit down — it is the one that is hard to change afterwards.