The cost of setting up a limited company varies depending on your required services. Creating a company in the United Kingdom is quite affordable and quick compared with the effort involved in starting the business. You can register a limited company directly with Companies House for just £50.
If you would rather not deal with the paperwork yourself, however, then you may hire a professional company formation firm like Uniwide Formations to handle it all for you. Opting for our services ensures that everything is done correctly and swiftly, and at a competitive price, giving you peace of mind throughout the process.
The Cost of Setting up a Limited Company in the UK – What Are Your Options?
There are several options available when forming a limited company. The cost of each will depend on the services required and the complexity of the business structure.
According to official Companies House data, 890,684 new companies were registered in the financial year ending March 2024, reflecting an 11.2% increase from the previous financial year. This significant growth brought the total number of registered companies to 5,350,759 by the end of March 2024, a 4.6% rise compared to the previous year.
In all cases, the company formation itself will be recorded on the register at Companies House. There are, however, three typical routes to start a new company:
- Direct with Companies House.
- Use an accountant or solicitor.
- Use a company formations agent.
Choosing the right option for you will depend on a number of factors, such as whether you feel confident in dealing with Companies House, whether you need any professional advice and whether speed is of the essence.
Forming a Company Directly via Companies House
The most direct route, unsurprisingly, is to incorporate your new company directly with the registrar at Companies House. You can either do this online or submit paper forms by post. In the financial year ending March 2024, 91.5% of company filings were submitted digitally, offering a quicker route to incorporation.
On average, Companies House processes online incorporation applications in under 24 hours, especially if there are no errors in the documents.
To submit an application online you must first create a free account at Companies House. The standard registration costs £50. You will need to complete the form IN01, which asks for details about the director/s and shareholder/s, the registered office address of your firm and other company information.
If you would prefer to register by post, then you will need to fill in the physical version of the application form IN01. To apply by post costs £71 and may take 8 to 10 days.
Forming a company directly with Companies House is a cost-effective way to set up your business. You will have direct access to the registrar, which means you can complete the process quickly but without any help.
Disadvantages of Forming a Company Directly via Companies House
- The process may be slower than using a professional Formation Agent.
- Without assistance, the process might be frustrating or even impossible. You must have a thorough understanding of the procedure in order to complete it on your own.
- Companies House may reject your application if it is incomplete or incorrect.
- You will need to provide Companies House with the company’s registered address and the director’s service address, which must be your workplace or home address. This address will be made public, since it will be accessible to everyone on the public record through the Companies House website. In contrast, most Formation Agents can provide your company with a registered address separate from your home or other address.
- You will need to find a bank that will set up a company account in the name of your new firm. Many Formation Agents can help you with this, whereas Companies House cannot.
- You will get no special discounts or incentives from other business sources, such as Card Acquirers, Domain Registration Services or Accounting Software Providers. In contrast, most Formation Agents can give you all these and more.
Using an Accountant or Solicitor to Register a Business
If you are not confident in dealing with Companies House, or if you feel you need professional advice, then another option is to use an accountant or solicitor to handle the incorporation process for you. This will obviously cost more than doing it yourself but should increase the chance that everything will be done correctly.
Accountants are often best placed to help with the financial aspects of setting up a new business, such as tax and accounting. Costs of setting up a limited company will vary depending upon whom you use but, as a guide, an accountant may charge anywhere from £100 to £500+VAT, whereas a solicitor is likely to charge between £200 and £1,000+VAT.
Drawbacks of Using an Accountant or Solicitor While Registering a Company
- The procedure is generally slower than using a professional Company Formation Agency.
- Forming a company using an accountant or solicitor may often be considerably more expensive than using a professional Company Formation Agent.
- You cannot take advantage of the same special deals that you are offered when working with a Company Formation Agent (e.g. specific discounts on various business services or banks).
Is It Worth Hiring a Company Formation Agent?
Numerous specialist business formation agents in the UK can help you set up your new company easily. At Uniwide Formations, we specialise in setting up new businesses quickly and cost-effectively.
This option may cost more than going directly to Companies House. However, it is often less expensive than hiring an accountant or a solicitor. This approach handles everything for you. It also provides services that Companies House does not offer. There are advantages to hiring a formation agent, instead of forming a company or partnership alone.
If you have not dealt with Companies House before and prefer to avoid risk, hire a company formation agent. Most UK agents are linked securely to Companies House. They file incorporation papers electronically to give you a fast service. Your firm can often be registered in less than 24 hours, or sometimes on the same day.
Using a professional formation agency reduces the risk of rejection by Companies House. Common reasons for rejections include:
- Missing information about Persons with Significant Control (PSCs)
- Typos or incorrect spellings in the application
- Using incorrect or offensive company names
- A registered office address in the wrong region
- Using initials instead of full forenames for directors
- Recording unrecognised occupations for company officers
A formation agency double-checks your application to ensure accuracy and speed up the process.
Cost of Registering a Company Through a Company Formation Agent
The costs of registering a company vary, depending on your company formation package. You can pay anything from 50 pounds to a few hundred.
Add-ons are a vital component of many registration services. Specialist formation agents often provide discounted add-ons, such as registered office services, saving up to 30 percent on standalone purchases.
A professional formation service may include, among other things, help with the type of business that best meets your needs, company name creation guidance, registered office address and post forwarding services, VAT and PAYE registration assistance, business bank account referrals, and so forth. Everything that you need to start on the right foot is available through a Formation Agency.
Cost-Effective UK Company Formation Packages
Uniwide Formations provides a choice of five company formation packages for UK residents, each designed to help you form a UK limited company swiftly and legally. All packages include the mandatory £50 Companies House filing fee. Our Proxy, Privacy, Advanced, and Premium packages also include a year’s registered office address at our Kensington location, keeping your official mail secure. Every option also comes with digital company documents, such as the Certificate of Incorporation and the Memorandum & Articles of Association, to help you stay compliant.
There is a package to match every budget and privacy requirement. The Basic package is the cheapest at £59 plus VAT, while the Premium option is the most comprehensive at £199 plus VAT. Each choice includes free access to our online client portal, where you can manage existing companies and register new ones without re-entering details. You can add optional extras, such as printed documents, a business postal address, and VAT registration assistance, at any time. If you need professional bookkeeping support, our partner accounting services are also available.
For non-UK residents, our Non-Resident Package delivers everything needed to register a limited company in the United Kingdom while maintaining a London presence. This specialist package includes our Kensington registered office and service address for one year, plus all required documentation. It also gives access to international business account options.
* All costs mentioned are correct at the time of writing.
Do Not Forget Ongoing Compliance Costs
Every UK limited company must file a Confirmation Statement each year. This confirms directors, shareholders, and PSC details. You must also submit annual accounts to Companies House and keep accurate financial records. Failure to comply can lead to penalties, prosecution, or even company strike-off. For example, late filing of annual accounts can result in fines up to £1,500 for a private limited company.
Registering for Corporation Tax is mandatory within three months of starting any form of trading. If your turnover exceeds the VAT threshold, VAT registration is also compulsory. If you employ staff, you must set up PAYE. This system ensures correct tax and National Insurance deductions.
Keeping statutory registers (including a register of charges) is a legal requirement. Any changes to company information must be reported to Companies House immediately.
Conclusion
This is only a brief overview of the cost of setting up – i.e. registering – a limited company. Several options are available to you, as you can see, and the price will depend upon which route you choose. Please contact us today for more information on a limited company formation. For further details, refer to our page on “How to Set Up a UK Limited Company”, which provides extensive guidelines and tips.