As you take those next big steps towards starting up your own business, one topic of conversation keeps rearing its head time and time again: registering with Companies House. Everyone keeps telling you what an important step it is for any business, but let’s be honest – you’re not even sure you actually need to register, let alone how to go about it if you do.
Don’t worry, you’re not alone.
Registering with Companies House can be a source of confusion for many a would-be business owner, but it doesn’t have to be. Here, we’ve put together our knowledge to provide you with your complete guide to registering your business, giving all the answers to your most pressing questions.
Do I have to register with Companies House?
Forget what your know-it-all mates might have told you, registering with Companies House isn’t a requirement for every tradesman who decides to go it alone. In fact, it’s often the case that most tradesmen don’t, as they tend to class themselves as a sole trader.
If you’re taking this route to self-employment, then you don’t need to register with Companies House, but you do need to register with HMRC in order to complete your self-assessment tax returns. Don’t panic though; this is easier than it sounds. In fact, we already put together a complete to registering and filling in a self-assessment, which you can check out here.
If, on the other hand, you’re starting a limited company or an LLP (Limited Liability Partnership) then yes, Companies House will be expecting to hear from you. Again, there’s no need to worry. It’s actually a relatively straightforward process.
What are my options for registering?
Basically, you have two options here – complete the registration yourself, or pay someone else (a third-party registrar) to do it for you.
Doing it yourself will usually work out to be the most affordable option, though if you’re short on time or just really loathe paperwork, letting a registrar do the hard work for you may be worth the investment.
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What are the benefits of paying a company registrar to do it for me?
Apart from the fact that it simply saves you time on filling out forms, hiring a third-party to register your new business with Companies House also avoids the risk of there being any errors with your application. If you’re not exactly brimming with confidence at the prospect of completing your registration, this alone can make paying a registrar worth it.
Then there’s the issue of having an address on the public record. When you register, you’ll need to provide a registered address for your business as well as a director’s service address. A third-party registrar can provide you with officially registered addresses in both instances.
Not only does this save having your director’s home address in the public domain, it also comes with the added benefit that your business could be registered in a prime location since a lot of registrars have addresses in some of the posher parts of London.
As you can imagine, this adds a certain sense of prestige and professionalism to your new startup and avoids anyone finding out that your office is really just the dining room table!
What do I need to do if I register myself?
If you do decide to save a few quid and go it alone, there are some key pieces of information that you’ll need to get together first.
These are:
- Company name
- Address
- Details of company directors and company secretary (where appropriate)
You’ll also need two important documents: A memorandum of association, which is a legal statement signed by all your shareholders agreeing to form the business, and Articles of Association, which are written rules about how the company will be run, agreed by your shareholders, directors, and company secretary.
The government’s website has a standard memorandum of association template that you can use. Gov.uk also recommend using what is known as standard or model articles. These are basic, catch-all rules that have been pre-written and can apply to your business.
You are, of course, free to write your own articles, but apart from the fact that this could take ages, it also means you won’t be allowed to use the quicker, more affordable online registration process at Companies House.
When you have all that together, there’s only one thing left to do: head to the Companies House website and follow the simple instructions for registering your new business.
How much does it cost to register with Companies House?
Honestly, it costs less than you might think.
If you like things quick and easy (and who doesn’t?), you can complete your registration online for only £12. Your registration will be processed within 24 hours. If you prefer to keep things old school, you can register by post, which costs £40 and takes 8–10 days.
You can even pay for same-day registration as long as you get your application in by 3pm. However, this costs £100, so it’s not the best option if you’re in a hurry.
Naturally, if go through a third-party registrar, they will also charge a fee, though you can find some companies who charge as little as £10–£15 on top of the set registration fees.
Do you have other questions about setting up a trade business that we haven’t already answered? Let us know in the comments below, or via Facebook and Twitter, and we may cover your question in one of our future blogs.
Tradesman Saver also provides insurance for tradesmen covering a wide variety of professions, as well as insurance for self-employed professionals. For further information, please see our Tradesman Insurance or Who We Cover pages.
