How foreign entrepreneurs can register a UK company step-by-step guide

The United Kingdom offers a wealth of opportunities for entrepreneurs from technology, health, finance, and hospitality to education. With the growing economy, entrepreneurs can register new company in UK and tap into the global economy.

Registering a UK company as a foreign entrepreneur can be challenging due to all the intricacies and complex legal legislation. Whether you want to start a business in London or Scotland, this article will explore a step-by-step guide to registering a UK company and the legal requirements needed to incorporate a company.

Understanding the requirements of registering a UK company

To register a UK company, there are things you will need. The very minimum requirements include:

A director

There should at least be one director who should be 16 years old. A director can either be a human or an entity, however, at least one director should also be a human.

A registered office address in the UK

According to the Companies Act 2006, a registered office address should be an ‘appropriate’ address. Meaning, that the address should be a physical location, able to receive correspondence, and be acknowledged by a representative on behalf of the company. A P.O. Box cannot be used as a registered office address.

The registered office address should be in the same jurisdiction as where the company is registered, this means, that if your registered office address is in Northern Ireland, then your company should be registered in Northern Ireland regardless of it operating from anywhere in the world.

A shareholder

A shareholder does not need to be a UK resident. However, they should comply with the UK legal age of becoming a shareholder which is 16 years old.

Memorandum of association

This is a document that defines the company structure, purpose, and activities. It’s a fundamental document that’s required for all companies, whether they are private or limited. The document includes the company’s name, location, activities, constitution, external boundaries, and objectives

Articles of association

These are the internal rules and regulations that govern how the company is governed. The article defines the company’s purpose, legal form, and capital structure, how the company is governed and owned, how tasks are accomplished, including appointing directors and handling financial records, responsibilities and powers of the directors, and specifications of how shareholders can exert control over the board of directors.

Company structure

Before you start the company registration process, you have to choose a company structure that will determine your business operations. A company structure determines how you are going to pay taxes, and whether you have to register your company with Companies House or not.

In the UK there are various company structures that entrepreneurs can choose from.

Sole trader: this is a business structure that is operated by an individual. The individual acts as a self-employed individual, they are in charge of the business and ensure that every business task is completed. Sole traders are required to register with HM Revenue & Customs (HMRC) for Self-Assessment.

Limited company: UK limited company can either be public or limited.

•         Public limited company: also known as PLC, this is a company that trades publicly and must issue shares to the public on the stock exchange.  This means that anyone can invest in the company. Shareholders are only responsible for the amount they invest in shares.
•         Private limited company: also known as Ltd, this company is owned by one or two shareholders. This is a separate legal entity that is separate from the directors and shareholders. Its shares are not publicly traded, only a limited group of shareholders can own them.

Limited Liability Partnership: this is where two or three sole traders or entities come together to form a company. It is a separate legal entity from their owners and other businesses. The partners share profits, dividends, and losses. The partners are also responsible for paying their own taxes.

How to register a UK company

Choose a company name

A company should have a name. To check the availability of your proposed name, use the Companies House company availability checker name. The name should be unique, and distinctive, not similar or same as the existing company names.

There are name rules set by Companies House that entrepreneurs should understand before they choose a company name. These rules include:

•         The name must end in either ‘Limited’ or ‘Ltd’. For companies registered in Wales, the name must end in ‘Cyfyngedig’ and ‘Cyf’.
•         The name should not be offensive.
•         The name should not contain a ‘sensitive’ word or expression
•         The name should not suggest a connection with government or local authorities unless you get permission.

Complete your memorandum and articles of association

Before you register a company, you need to complete the MOA and AOA. Both documents should be signed by the directors and shareholders.

Choose your registered business address

As a foreigner, you can choose a virtual address service provider to rent an address that will be your registered office address. Every company needs a registered office address if they are going to register with Companies House.

Get a Standard Industrial Classification of Economic Activities (SIC) code

 Once you have a registered office address, get a SIC code that identifies with your business activities. Company formation agents offer an online platform where you can get a SIC code.

Register your company

Once you have all the addresses and a SIC code, you can seamlessly register your company by filling out all your business details on the online platform. Whether you are registering with the Companies House website or company formation agents, the online platforms offer a seamless and direct process. Also, include the directors’ and shareholders’ information and also that of people with significant control (PSC).

Open a business bank account

Once your business is registered and trading, you can open a business bank account. They will require proof of address, identity, and proof that your business exists. They will require a company registration number (CRN), annual turnover, and registered office address.

The other things that you will be required to register for are corporation tax, PAYE, and VAT with HMRC.

In summary, foreigners can easily register their company in the UK. The requirements and the process are systematic, making it easier to register with either Companies House or a company formation agent.

The editorial unit