Stage 2 – Starting a Company
Starting a company is a straight forward process, it takes on average about 2-3 hours to process and costs £12 when formed using the Companies House website.
You will need to have an address that will be the registered office address of the company and at least one director and one shareholder, they can be the same person if you are a one-man band company. The company will need to choose a name that is unique and is not currently being used by another company, you can check that if the name is unique by typing the name on the Companies House website.
Once the company is formed and you have the Incorporation Certificate you need to contact your bank and ask them to open an account in the company name. The company will need to have it’s own bank account to be paid in to, you can not use a personal bank account to receive payments that belong to the company.
As soon as the bank account is opened the company can start the process to be vat registered if the turnover is going to be above the vat registration threshold currently £85000. If the turnover is going to be below the vat registration threshold you can choose to voluntarily register for VAT, or you can wait until the turnover goes over that amount.
If you are going to be employing people, including yourself if you are the only director, the company will need to register as an employer with HMRC.
About two weeks after the company was formed you will receive a letter in the post from HMRC called ‘Corporation Tax information for New Companies’ it will contain the Companies Unique Tax Reference number or UTR. You can then use this UTR to register the company for corporation tax.
Once you have done all these processes you will have a limited company that can be used for your business.