How to Register as a Sole Trader or Limited Company in the UK: Step-by-Step

Starting a business in the UK doesn't require months of paperwork. Registering as a sole trader takes 10 minutes online. Incorporating a limited company takes about 48 hours and costs £50.

The harder decision isn't how to register. It's which structure to choose. Once you've made that choice, the actual registration process is straightforward.

Registering as a Sole Trader

What You Need Before You Start

• National Insurance number
• Personal contact details
• The date you started (or plan to start) self-employment
• The nature of your business (HMRC uses SIC codes, but you can describe it in plain English)

The Registration Process

Step 1: Go to HMRC's online registration page (search "register for Self Assessment" on gov.uk).

Step 2: Create a Government Gateway account if you don't have one.

Step 3: Complete the online form with your personal and business details.

Step 4: Receive your Unique Taxpayer Reference (UTR) by post within 10 working days.

Step 5: Receive an activation code separately, also by post.

That's it. You're registered.

Deadline: You must register by 5 October following the end of the tax year in which you started trading. Starting in July 2026? Register by 5 October 2027. But registering immediately is recommended because it avoids complications.

What Registration Means

You're now registered for Self Assessment and Class 2 National Insurance. You'll need to file a tax return by 31 January following the end of each tax year and pay any tax due by the same date.

You don't need to register at Companies House. You don't need to publish accounts publicly. You can start trading immediately using your own name or a chosen business name.

Choosing a business name: You can trade under any name you like as a sole trader, as long as it doesn't include "limited," "ltd," "plc," or similar terms that imply incorporation. You must display your own name and address on business correspondence.

Incorporating a Limited Company

What You Need Before You Start

• A company name (checked against existing registrations at Companies House)
• At least one director (can be you)
• At least one shareholder (can also be you)
• A registered office address (can be your home, or a third-party address)
• Details of people with significant control (PSC, usually you if you own 25%+ shares)
• SIC code for your business activity

The Registration Process

Step 1: Go to Companies House's web incorporation service.

Step 2: Check your desired company name is available.

Step 3: Complete the online form with company details, director information, shareholder details, and initial share allocation.

Step 4: Pay the £50 registration fee (same-day electronic processing).

Step 5: Receive your Certificate of Incorporation, usually within 24 hours of submission.

You'll also need to:

• Register for Corporation Tax with HMRC within 3 months of starting to trade
• Set up PAYE if you plan to pay yourself a salary
• Register for VAT if applicable (turnover above £90,000, or voluntary)
• Open a business bank account in the company's name

Formation Agents

Services like Companies House Direct, Rapid Formations, and 1st Formations offer company formation packages from £10-100. They speed up the process and often include:

• Name availability checking
• Standard Memorandum and Articles of Association
• Share certificates
• Registered office address services
• Company documents templates

For most straightforward incorporations, the DIY route through Companies House is perfectly adequate. Formation agents add value if you need a registered office service, specific share structures, or want someone else to handle the paperwork.

After Registration: Essential Next Steps

For both structures:

• Open a dedicated business bank account
• Set up accounting software or engage an accountant
• Arrange business insurance appropriate to your activity
• Register for VAT if required or beneficial
• Start keeping records of all income and expenses

Additional for limited companies:

• Set up payroll (even if only for yourself)
• Understand your annual filing obligations (confirmation statement, accounts, CT600)
• Familiarise yourself with director responsibilities

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