Companies House is the official register for all companies in the UK. On the Companies House website, you can find the name and details of all registered companies. But which companies are required to register with Companies House And what responsibilities does Companies House have towards the general public
In this article, we’ll have a look at what type of companies need to be registered with Companies House, as well as where sole traders come into the picture. Whether you’re a sole trader or a limited company, you should find definite benefits and insight from learning more about Companies House in the UK.
What else should be known about Companies House
Companies House currently employs around 1000 team members in their UK offices. Louise Smyth is the current Chief Executive of Companies House. There are also Companies Houses in Scotland and Northern Ireland.
The responsibilities of Companies House in the UK is to dissolve and incorporate limited companies and provide the public with a comprehensive list of all of the limited companies and limited liability partnerships alongside detailed information about these companies.
Companies House allows you to find company information and download company data all at the click of the button, providing full transparency. In cases where limited companies are run out of someone’s home, company owners can request for certain details to remain hidden for privacy reasons.
Do sole traders need to register with Companies House
The simple answer to this question is ‘no’. As much as some sole traders believe they need to register with Companies House, no sole traders need to register with Companies House.
Which companies need to register with Companies House
Limited companies and limited liability partnerships (LLP) are legally required to register with Companies House. Sole traders wanting to reap the benefits of registering with Companies House will need to look at changing over their business structure to that of a limited company or limited liability partnership.
Currently there are over 4 million limited companies in the UK that are registered with Companies House, and as many as 500,000 new companies are incorporated each year!
How do you register with Companies House
If you own a limited company that needs to be registered with Companies House, the process can definitely appear daunting. But when you understand the process and have gathered all the information you’ll need, registering with Companies House is actually fairly simple.
You are able to register online for a fee as little as £12, and you can expect the application to take around 24 hours. If you want to register via post, you’ll need to pay £40, and the process can take nearly two weeks. If you need to have your application processed on the very same day, a fee of £100 will apply, and you’ll need to submit your online application by 3 pm on the day that you want it registered by.
There are many third parties that will charge you a fee in exchange for handling all of the paperwork and the registration process for you if you want to save on time. Some third parties charge as little as £30 to handle the entire process for you.
The process for registering with Companies House includes:
- Gathering info such as business name, address, director details, contact numbers etc.
- Access a memorandum and articles of association
- Register by following the step-by-step process on the Companies House website
- Pay the required fee
- Appear on the register within 24 hours
Be meticulous when filling out the online application, as small errors could lead to you having to redo your entire application.
If sole traders don’t need to register with Companies House, what do they need to do?
Just because sole traders don’t need to register with Companies House doesn’t mean that they don’t have other responsibilities. As soon as you begin your journey as a sole trader, you’ll need to register with the HMRC, and each year you’ll need to submit a self-assessment in which you may need to pay tax on your profits. You may also be liable to National Insurance Contributions once you start making them over a certain threshold.
Registering with the HMRC is a simple and straightforward process, and once you’ve successfully registered, you’ll receive a Unique Taxpayer Reference (UTR) which is a reference number that you’ll use when paying tax.
Another responsibility that may be applicable to you is registering for VAT.
What happens if I want to change over from a sole trader to a limited company?
Are you a sole trader that has decided that a limited company is perhaps more in line with what you want to achieve You may want to consider changing over.
You are able to convert in around three working days if you send an application to Companies House. Ensure that the name that you are currently trading under is available using the name-checking tool and then gather all the information necessary, such as an address, director’s details, shareholder’s information, services, access memorandum etc.
Registering as a limited company and being registered on Companies House may make you more appealing to investors, suppliers, and buyers. Many would rather go through a reliable limited company than take a risk by using a sole trader; for the most part, that is just how business is.
Registering as a limited company may also have tax benefits for you. But at the end of the day, making the change from sole trader to a limited company is a fairly large step, and it shouldn’t be taken lightly.
Whether you are a sole trader or a limited company, it’s very important to know exactly what is expected of you and that everything you’re doing is above board. It would not be good for your business reputation to get into hot water with Companies House or the HMRC. If you are ever confused about what is expected of you and your company, it is always a great idea to chat with a trusted and professional financial advisor.