How Do I Set Up a Limited Company?
If you’ve been asking yourself, “how do I set up a limited company?” you’re not alone.
It’s a common step for business owners who are ready to move beyond being a sole trader and want a more structured, tax-efficient, and scalable way to run their business.
Setting up a limited company is straightforward, but there are important decisions to make along the way. Getting this right from the start can save time, reduce stress, and help you build a strong financial foundation.
At Infinity Accounting, we support business owners through the full process, making it simple, clear and stress free.
Is a Limited Company Right for You?
Before setting up a limited company, it’s important to understand how it differs from being self-employed.
A limited company is a separate legal entity. This means:
- The company is responsible for its own debts
- Your personal liability is usually limited to what you invest
- You can take income through salary and dividends
- Your business may be more tax efficient as profits grow
Limited companies are typically:
- Limited by shares – most common for profit-making businesses
- Limited by guarantee – usually for non-profit organisations
If you’re unsure which structure is right for you, we can help you compare your options:
https://infinity-accounting.co.uk/services/
You can also read HMRC guidance here:
Step 1: Choose a Company Name
When setting up a limited company, you’ll need to choose a unique business name.
Your company name must:
- Be different from existing registered companies
- Not infringe on trademarks
- Usually end in “Limited” or “Ltd”
You can check name availability here:
https://www.gov.uk/get-information-about-a-company
You can also trade under a different name (known as a business name), but there are rules around what this can include.
Step 2: Appoint Directors and Company Officers
Every limited company must have at least one director.
As a director, you are legally responsible for:
- Keeping accurate company records
- Filing accounts and tax returns
- Following company rules (articles of association)
- Paying Corporation Tax
Even if you appoint an accountant, you remain legally responsible for the company.
HMRC director responsibilities guidance:
https://www.gov.uk/running-a-limited-company
You do not have to appoint a company secretary, although some businesses choose to.
Step 3: Decide on Shareholders and Ownership
Most limited companies are limited by shares, meaning they are owned by shareholders.
Key points:
- You need at least one shareholder
- A director can also be a shareholder
- If you’re the only shareholder, you own 100% of the company
- Shares can be set at a low value (e.g. £1)
You will also need to identify any Person with Significant Control (PSC).
A PSC is someone who:
- Owns more than 25% of shares
- Has voting rights or control
You must record this information and report it when setting up your company.
PSC guidance:
https://www.gov.uk/guidance/people-with-significant-control-pscs
Step 4: Prepare Your Company Documents
To register your company, you’ll need two key documents:
- Memorandum of Association
A legal statement confirming the intention to form the company.
- Articles of Association
Rules on how the company will be run.
If you register online, standard versions are usually created automatically, making this step simple.
Step 5: Register Your Limited Company
You can register your company through Companies House.
During registration, you’ll need:
- A registered office address
- Director and shareholder details
- Your SIC code (what your business does)
You can register here:
https://www.gov.uk/limited-company-formation
You’ll usually also register for Corporation Tax at the same time.
If not, you must register separately with HMRC:
https://www.gov.uk/register-for-corporation-tax
What Happens After You Set Up Your Company?
Once your company is registered, there are ongoing responsibilities to manage.
These include:
- Filing annual accounts with Companies House
- Submitting Corporation Tax returns
- Running payroll if you pay yourself a salary
- Keeping accurate financial records
This is where having the right support in place makes a big difference.
How Infinity Accounting Can Help
Setting up a company is just the beginning. What really matters is how you run it.
At Infinity Accounting, we help business owners:
- Set up their limited company correctly
- Choose the right structure and share setup
- Register with HMRC and Companies House
- Set up accounting software and systems
- Plan tax-efficient ways to take income
- Stay compliant and organised
You can explore our services here:
https://infinity-accounting.co.uk/services/
Or get in touch with our team:
https://infinity-accounting.co.uk/contact/
If you’ve been wondering, how do I set up a limited company, the process itself is simple, but the decisions behind it are important.
Getting the right advice early can help you avoid costly mistakes, stay compliant, and build a business that’s set up for growth from day one.
If you’re thinking about making the move, we’re here to guide you every step of the way.
