How To Register A Business In The UK

The first step to setting your business idea into motion is getting your business registered. Registering a business doesn’t need to be an overly complicated process. In fact, you can actually do a lot of it online. 

However, there are still a couple of things you need to be aware of. It’s crucial to take into consideration the type of business you will register, tax obligations, relevant contracts and other legal regulations before you take that first step. 

After all, registering your business is setting up the foundations for your success. Naturally, you want to get this right and make sure it’s as strong as possible. That’s why it can (literally) pay off to know what you’re doing from the get go.  

Let’s discuss this in more detail below. 

Registering A Business  

How you go about registering your business will depend on the type of legal structure you have selected for your business. The most common types of business structures are:

• Sole trader
• Partnership 
• Company  

Businesses that follow the legal structure of a company  will need to register with Companies House. Registering with Companies House can be done online, and you will need to provide the relevant details and pay any fees. 

In addition, you’ll receive a Company Registration Number (CRN) – it’s important to take note of this unique number as you’ll need it for tax purposes. 

Sole traders and other types of partnerships follow a slightly different registration process. Rather than registering through Companies House, sole traders and partnerships just need to notify HM Revenue and Customs (HMRC) that they will be paying tax through Self Assessment. 

Registering your business is also a good time to think about your business name. For companie, a company name will need to be registered with Companies House. You can use the Company Name Availability Checker to see what names have already been registered.  

Partnerships and sole traders do not need to register a name. However, if you are using a name other than your own or the names of the partners, it’s important to put both the names where necessary. For example, the name of the business owner as well as the business name will be on important legal documents such as contracts and invoices. 

When Do You Need To Register A Business? 

Registering your business should be done as soon as possible (we recommend a maximum of 3 months after starting your business activities). This is because registration is the formal process of  letting the relevant bodies know that you’re conducting business, so it helps you sort your tax obligations and avoid penalties for breaching laws. 

In order to legally operate your business, you need to have it registered. Therefore, it’s advisable not to start trading or conduct any other business operations until you have applied to register your business and the application has been accepted. This way, you can be sure you’ve followed the correct legal procedures. 

Can You Check If A Business Is Registered? 

Yes, it’s possible to check if a company is registered. This might be useful if you’re thinking of associating your brand new business with another one or you simply want to get a sense of what’s out there. If a company is registered, you will be able to find it through the Companies House Register. 

Similarly, if you’re registered with Companies House, then others will also be able to look up details regarding your company using the same search. Therefore, even after you have registered your business, it’s important to keep updating all your information regularly to ensure it’s correct.  

What Is A Business Registration Number? 

Once you have successfully registered your company, you will receive a Company Registration Number (CRN). 

The CRN is a unique identifier that usually consists of 8 digits and characters. 

Each company receives one and will need to display it usually when dealing with government agencies, legal matters or when getting into contracts. Therefore, if you receive a CRN, make sure to keep the number close by as it will come in handy. 

Register A Sole Trader Business 

We’ve mentioned registering as a sole trader above, so now, let’s take a closer look at how this really works. 

A sole trader is an individual that runs and completely owns their business. Unlike a company which functions as its own legal entity separate from the owners of the business, a sole trader and their business do not have different legal identities. Therefore, all the risk, liability and benefits of the business belong to the sole trader. 

On the bright side, however, setting up as a sole trader is relatively cheaper and less complex. So, if you’re planning on keeping things small and simple in your business, a sole trader structure is perfect for you. 

Unlike a company, a sole trader does not need to report to Companies House. However, this does not mean sole traders have no legal obligations. They are still responsible for their booking keeping, records and tax obligations. Depending on your individual circumstances, it’s important to see which ones apply to you. 

If you’re confused about any of this, our team at Sprintlaw are always happy to chat with you! 

When Does Business VAT Need To Be Registered? 

Value Added Tax (VAT) applies to businesses after they have started earning over a certain threshold. If your business made over £85,000  in taxable income over a one year period, then you will need to apply for VAT. 

VAT can be registered online using the Government Gateway sign in. Once VAT is successfully registered, you will receive a 9-digit VAT number that will need to be used on any invoices or tax related matters. 

How To Check If My Business VAT Is Registered 

It can be daunting to know whether you’ve done everything right or not, so if you’re unsure, you can always check whether or not your VAT number is still valid. You can do this by entering your VAT number here. Once you’ve correctly entered the number and hit ‘search’ the result should show whether the number you put in is registered for VAT or not. 

It’s also wise to do this process for other businesses you might be associating with in the future. It could drag your business down to be entangled with other business owners that are not legally compliant. It can save you a major headache down the line to do a quick search! 

What If I Want To Register A Food Business? 

Your business registration process will also differ based on the type of business you decide to open. For example, a business that manufactures clothing and one that sells food will have two very different requirements. 

Along with registering your business through the relevant government agencies, you also need to be researching what types of registration might apply to your specific industry. 

Let’s say you’re thinking of setting up a food startup or perhaps you’d like your own food truck. In these cases, you’ll need to gain permission from your local authorities and gain a food business registration licence. Along with your licence, it’s also vital to think about other regulatory compliance measures, such as food health and safety, training, qualifications and storage. 

It’s best to have all this looked into and sorted when you’re in the early stages of your business so you’re not caught off guard by anything later on.  

Can I Register A Business At My Home Address? 

In a lot of cases, it doesn’t make sense to have a separate office space for work when it could all ideally be done from your own home. It is possible to register your business at your home address, but there are a  couple of things you will need to consider first: 

• Zoning regulations and permission from your local council (especially if you’re thinking of altering the property for this purpose)
• If you’re renting, it’s important to see if your rental agreement or landlord allows this 
• Business rates

Whether or not you will be able to run your business from home will depend greatly on where you live and what your specific business is. Along with local council regulations, it’s also important to plan ahead and see what running your business from home might look like. 

We’ve put together this guide to laws on running a business from home. In addition to these considerations, it’s also wise to think about how your employer obligations will look in a remote work environment. 

Let’s look at this in more detail below. 

Employer Obligations

If you decide to operate your business from home and you hire employees, then your obligations to those employees still need to be taken care of despite the absence of a traditional office. Workplace health and safety obligations are the duty of every employer, regardless of location. 

Your employees might come to your home in order to work, in which case you will need to have adequate space and facilities for them. Otherwise, you may decide to take up the option of remote work. Either way, you’ll need to think of the best way to keep your employees in a space that is safe for them mentally and physically. 

For example, you may have an internal process in place where you conduct mental health check-ins through regular Zoom meetings with your employees. You may also wish to send out a checklist to your remote employees to ensure they have safe and adequate working equipment at home. 

The Health and Safety Executive (HSE) is responsible for enforcing workplace health and safety laws in the UK – click here to learn more. 

Your Employment Contracts with your employees should cover any work space related conditions or clauses, so both parties can be on the same page regarding this matter. Employment contracts also cover a lot of other important details, so it’s always wise to consult a legal expert! 

What Other Legal Obligations Do I Have? 

As a business, you’ll have a number of legal obligations that you will need to be aware of as you progress through every stage of owning a business. Business registration is the first step, but after that, you’ll need to sort out other legal documents and internal processes so that you’re legally compliant. 

Legal obligations can be dependent on the individual business, but we suggest looking out for matters regarding: 

• Consumer law compliance
• Contracts and agreements 
• Data and privacy 
• Intellectual property concerns 

Our legal experts can help with all of these and more – get in touch with us today for a chat.  

Key Takeaways 

When taking the step to register your business, it’s important to be well prepared so you can make sure you’re making the best decisions for your business. To summarise what we’ve discussed: 

• Business registration will depend on your business structure 
• Companies and limited liability partnerships are registered through Companies House
• Registering through Companies House means you will get a Company Registration Number (CRN)    
• Other business types, such as a sole trader, will need to notify HMRC through a Self Assessment
• If your business is expected to earn over a certain threshold, then you’ll need to look into VAT 
• Business registration requirements will also depend on the specific industry
• Businesses can be registered to your home address. You’ll need to conduct your due diligence and keep up with the relevant legal obligations 

If you would like a consultation on your options moving forward, you can reach us at 08081347754 or [email protected] for a free, no-obligations chat.

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