How To Register a Company In The UK From Ireland

Step 1: Choosing Your Company Structure

If you are registering a new UK limited company, many companies will choose to opt for a ‘private company limited by shares’. This is especially popular with entrepreneurs.

This type of business structure is an effective way to help manage taxes. For example, if you are a company director, you can draw some income from the company’s dividends, and this will result in paying less tax.

As well as this, personal assets, such as a car and house, will not be at risk if the company ends up in any financial trouble. This is why it is known as ‘limited liability’.

Step 2: Registering The Company Name

Before registering a company in the United Kingdom, you must ensure that the name of the company is available. If this is a new company, you will need to choose a name. Some tips for choosing a company name include:

• Always research the market in which you will be operating. Competitor names can inspire your own company’s name.
• Keep it meaningful. The name of a company is always the first thing that customers will remember about it. Consider if it is memorable; it explains what the company does.
• Avoid hard-to-spell names. If it is hard to spell, it can make it less memorable. Similarly, make sure it is easy to pronounce.
• Keep the name short and punchy. A short, simple name can be easier to remember and always looks more attractive on marketing materials.

Step 3: Choosing Company Formation Packages And Enter Information.

With company formation packages, there are many types available, depending on how you choose to set the company up. If you choose to set up through a service that aids in company formation in the UK, many will have packages that help you do so.

However, if not, you can move on to entering your company information. When you register a UK company, a lot of the information provided will be made available publicly.

You will need to note the following information:

• The Registered UK Office Address: This is the address where Companies House and HMRC will send mail. This must be located in the United Kingdom, and reaching company directors at this address must be possible.
• Information regarding company directors: The business needs to have a minimum of one director. It is necessary to provide their name, residential address, and date of birth.
• Shareholder information: Each company needs to have a minimum of one shareholder, although it can be the same as the director. The residential address, name, and date of birth of this person will also be required.

If there is no separate address for the business, then a home address should be provided to register the UK company.

Step 4: Allocate Shares

When registering a company in the United Kingdom, it is imperative to allocate shares to the shareholder(s). The easiest way to do this is to allocate one share to each shareholder and make each share worth one pound.

Step 5: Complete Company Documents

It is necessary to complete the articles of association and memorandum. These documents are formal documents that disclose how the company will be run. These need to be agreed upon and signed by company directors, shareholders, and a secretary before the UK LTD company can be registered.

Step 6: Submission

Should the business wish for same-day registration, then it is necessary to submit all documents by 3 p.m. This is all that is required.

Additional Information.

When registering a company in the UK, you will also be registered for corporation tax simultaneously. Through this, you get a certificate of incorporation, which will confirm that the company exists legally and also show the date of company formation and the company number.

To apply to register a company, three pieces of personal information will be required about the applicant and the shareholders or guarantors. Some of these include:

• The individual’s town of birth.
• The maiden name of the individual’s mother.
• The first name of the individual’s father.
• The individual’s passport number.
• The National Insurance Number (NIN) of the individual.
• The telephone number of the individual.

Most companies get registered within 24 hours, and it only costs £12 and can be paid by credit card or debit card. However, if the business does not wish to use ‘limited’ in their company name, they will be required to register by post instead.

Overview

To employ staff in the UK, businesses need to register as an employer with HM Revenue and Customs (HMRC). This needs to be done when the business starts employing staff or when they use subcontractors for construction work.

It is important to register, even if you are only employing yourself. It is necessary to register as an employer before the first payday, as it can take up to 5 working days to get an employer PAYE reference number. However, a business cannot register as an employer any sooner than two months before paying staff.

To pay employees before getting your employer’s PAYE reference number, several things should be done. They are as follows:

• Run a payroll.
• Store full payment submissions.
• Send a late full payment submission to HMRC.

Most businesses will need to register as employers when employing staff, even as a limited company. As a limited company, it is important to register as an employer with HM Revenue and Customers if any of the following apply to you:

• If you are paying any employees £123 a week or more.
• If you are employing any director or person who has another job or who is already in receipt of a pension,
• If you are providing benefits or expenses to directors or employees,
• If you are hiring subcontractors for work in construction,

How To Set Up Payroll

To operate the PAYE (Pay As You Earn) system that collects income Tax and NIC (National Insurance Contributions) from employee wages, a payroll needs to be set up.

Employers can easily use payroll software and run payroll themselves, or it can be outsourced to accountants or third-party payroll providers.

As an employer, the employer is responsible for collecting and keeping records as well as telling HMRC about any new employees, the payment of directors and employees, and deducting NIC and tax contributions from wages.

It is also critical to ensure you give payslips to employees, pay tax and NIC deductions, and send payroll reports to HMRC, including any employer NIC that is owed.

However, if you use a provider for your payroll, they may be able to complete many of these for you on your behalf. This minimises the effort and time that need to be spent on payroll per month.

Contracts & Insurance

The Employer’s Liability Act of 1969 legally required employers to take out Employers’ Liability Insurance as soon as they became employers. That being said, this is not necessary if the individual is the sole director and owns 50% of the company shares with no other employees.

Policies need to come from authorised insurers and provide the business with at least £5 million of coverage. This safeguards you and your company against any legal expenses and compensation claims if employees sustain an injury or become ill, whether at work or as a result of work done.

Not properly insuring your company can result in fines of up to £2,500 per day not insured. It is also possible to be fined £1,000 if there is no Employers’ Liability Certificate shown when inspectors ask.

When you find a suitable UK employee for your business and they accept an offer, an employment contract must be provided by you either verbally or in writing. A written statement of employment particulars is also necessary.

This must set out employment conditions and employee rights, duties, and responsibilities. This will include the pay rate, which is at least the National Minimum Wage per age.

Overview

The business taxes a company in the UK can expect to pay will depend on several factors. These factors include:

• The structure of the business.
• The profits the business makes.
• How the business owner pays themselves.

This means that a business will never have to pay every single type of business tax. However, it is wise to be aware of the full scale of business taxes in the UK, as it can aid in the running and structure of the company.

The primary business taxes in the UK to be aware of include the following:

• Income tax.
• Corporation tax.
• VAT.
• National Insurance.
• Business rates.
• Capital gains tax.
• Dividends tax.

Corporation Tax

If the business is structured as a limited company, then corporation tax will need to be paid. This is also the case for companies that are foreign and have a branch or office in the UK, or if they have a co-operative, club, or other associated unincorporated association in the UK.

This tax is paid every year off of any profits made by the business during the financial year. It includes trading profits from doing business and also profits from the business per investment and the sale of assets.

If a company makes profits under £50,000 per year, they are charged 19%.

If a company makes profits over £250,000 per year, they are charged at a rate of 25%.

If a company makes profits between £50,000 and £250,000 per year, they will be charged at 25% but can reduce the effective rate paid through marginal relief.

Income Tax

Businesses may encounter income tax in two ways.

• As freelancers, sole traders, or self-employed business owners, they will pay income tax on profits over their personal allowance.
• As an employer, each employee will pay income tax on their salary over their allowance.

National Insurance Contributions

Businesses can encounter NIC in two ways, much like income tax.

• As a freelancer, sole trader, or self-employed business owner. The individual will make Class 2 and Class 4 NICs. Class 2 is flat at £3.45 per week; Class 4 is 9% on profits between £12,750 and £50,0270.
• As an employer, as well as the employee’s NIC, employers make NICs per employee at 13.8% of their income above the secondary threshold, which is anywhere from £758 to £4,189 per month.

VAT

Value-added tax is added to services and goods that are sold and is usually charged at 20%. You only charge VAT if you are a VAT-registered business. Once you register as a VAT business online, you have many responsibilities, including paying HMRC what VAT is owed. If you charge more VAT to customers than is paid in VAT, you need to pay the difference.

There are some items that are eligible for a reduced rate of VAT, or zero rate. Businesses must register for VAT if their taxable turnover is over £85,000.

Business Rates

If the company is operated out of a specific business location, such as an office or shop, then business rates are payable to the local council. This is calculated by multiplying the tax rate by the rateable value. The rateable value of the property is based on the open market rental value on a given date.

Dividends & Capital Gains

This is only paid by the owner of the business if they pay themselves a dividend. This will have tax paid on it if it is greater than £1,000. The tax rate for dividends is determined by income tax. Therefore, it is payable as follows:

• £12,571 to £50,270 income tax will have a dividend tax rate of 8.75%
• £50,271 to £125,140 in income tax will have a dividend tax rate of 33.75%.
• £125,140 or higher income tax will have a dividend tax rate of 39.35%

Alternatively, capital gains tax is paid on profits made when an asset is sole. This can include shares in businesses or property that is not an individual’s home but has increased in value.