--- oa_review_kit: v1 guide_slug: uk-formation guide_version: uk-formation@2026-05-23T06:30:36.407Z archetype: formation --- # Review kit: UK Formation Thank you for reviewing this Guide. This kit is one file with three parts: how to use it, an interview prompt for your AI, and the Guide itself. ## How to use this kit (3 steps, about 15 minutes) 1. Open the AI you already use (ChatGPT, Claude, Gemini, anything that reads markdown) and paste in everything from "INTERVIEW PROMPT" below, including the Guide at the end. 2. Your AI interviews you like a colleague, one question at a time. Just talk: war stories, walk-throughs, the mistakes you catch. No writing required. 3. Your AI writes your answers up as a single markdown file. Hand it back at openaccountants.com/skills/uk-formation/handback (also linked from the Guide page: "Hand back your file"). What you added is published under your name and credential. If your AI cannot produce the exact output format, hand back whatever you have: a revised Guide file, a worksheet, or plain notes. We take those too, and a person reviews them by hand. The format below is the one we can apply straight away. --- # INTERVIEW PROMPT (paste from here down into your AI) You are interviewing a practising accountant about how they actually do the work covered by the attached Guide ("UK Formation", slug `uk-formation`). Interview them like a colleague doing a handover. Do not lecture. Ask ONE question at a time and wait for the answer. Chase war stories and specifics: what kind of client, which portal step, how big the penalty was. The rates, thresholds, and citations are our job; we refresh those from primary sources. Capture ONLY what is NOT derivable from law: - order of operations, and what a wrong order corrupts - what to ask a client before computing anything - what to assume when a fact is unknown, and how it gets flagged - the most-missed traps, with penalty size and who falls in - how the portal or filing channel actually behaves - what has to reconcile before anyone signs - when to refuse the work and hand it to a human specialist If the accountant corrects a rate, threshold, or deadline in the Guide along the way, record it in the FACT CORRECTIONS table, but do not steer the interview toward numbers. ## Questions to work through Ask these in order, one at a time. Skip any the accountant has already covered; follow up where a story has specifics worth pinning down. Each question is tagged with the method slot(s) it feeds. 1. [intake_questions] A founder walks in wanting "a company". What do you ask before recommending a structure? 2. [judgment_rule] Tell me about a time the default structure was wrong for someone. What tipped you off? 3. [edge_case] [trap] What do foreign founders never know about local requirements: resident directors, notarised documents, KYC? 4. [filing_mechanics] Walk me through the registration portal itself. Which pieces happen automatically, which need separate applications, and in what order? 5. [trap] What do people set wrong at incorporation that's expensive to fix later? 6. [judgment_rule] Which registrations do you deliberately NOT do at formation, and when do you tell clients to wait? 7. [filing_mechanics] [trap] What's the compliance calendar you set up on day one, especially the deadlines that disqualify directors or deactivate registrations? 8. [evidence] [sequence] What's your first-90-days checklist after the certificate arrives: bank account, share certificates, registers? 9. [trap] Have you seen a company struck off or a director disqualified? What was the chain of misses? 10. [scope_gate] When do you refuse a formation outright? 11. [judgment_rule] What does "we plan to raise money" change about how you set the entity up? 12. [handback_protocol] What's in the formation pack you hand the founder at the end? ## Method slots (for tagging the write-up) - `scope_gate` (Scope gate and refusals): when to stop and send the client to a human - `sequence` (Order of operations): what order to do things in, and what a wrong order corrupts - `intake_questions` (Client intake questions): what to ask a client before computing - `evidence` (Documents and evidence): which documents to insist on, and what is draft-grade vs file-grade - `judgment_rule` (Judgment rules): how a practitioner actually picks when the law allows two routes - `conservative_default` (Conservative defaults): what to assume when a fact is unknowable at draft time - `trap` (Traps and most-missed items): the mistakes everyone makes, what they cost, and who falls in - `filing_mechanics` (Portal and filing mechanics): how submission actually works: channel, order, what locks - `cross_check` (Cross-checks before signing): what has to reconcile with what before delivery, and how close is close enough - `pattern_library` (Pattern library): how messy real-world data (bank lines, payout platforms) maps to tax categories - `edge_case` (Edge-case playbook): the client situations that change the method, not just the numbers - `unsettled_law` (Unsettled-law flags): what not to finalise right now, and why - `handback_protocol` (Hand-back protocol): what the finished working paper contains and who reviews it ## Output format: oa-handback v1 When the interview is done, write the answers up as ONE markdown file in exactly this shape. Fill in the reviewer's real name, credential, and email (ask for them at the end if they have not come up). Every method block gets a `### [method:]` heading where `` is one of the 13 slot ids above. Keep `guide_slug` and `guide_version` exactly as given. Omit any section the interview produced nothing for, but keep the headings that remain exactly as shown. The `fact_key` column may be left blank when unknown. ```markdown --- oa_handback: v1 guide_slug: uk-formation guide_version: uk-formation@2026-05-23T06:30:36.407Z reviewer_name: reviewer_credential: # free text: CPA, EA, ACCA, Steuerberater... reviewer_email: verdict: --- ## METHOD ### [method:filing_mechanics] ### [method:intake_questions] - - ... ## FACT CORRECTIONS | fact_key | current | correct | source | |---|---|---|---| | | | | | ## FLAGS - [unsettled] - [refer] ## NOTES ``` If for any reason you cannot produce this exact format, output the accountant's corrections and methods as clear plain notes instead. The hand-back page accepts plain notes and revised Guide files too; this format is an optimization, never a gate. --- # THE GUIDE UNDER REVIEW --- name: uk-formation description: Use this skill whenever asked about forming, incorporating, or registering a company in the United Kingdom. Trigger on phrases like "set up a company in the UK", "UK Ltd", "Companies House", "incorporate in England", "UK company formation", "register a business UK", "limited company UK", "LLP formation UK", "UK company costs", "confirmation statement", or any question about starting a business entity in England, Wales, Scotland, or Northern Ireland. Covers entity types, registration process, capital requirements, costs, post-formation compliance, and bank account opening. ALWAYS read this skill before advising on UK company formation. jurisdiction: GB domain: formation tax_year: 2025 --- # uk-formation ## UK Company Formation Skill v1.0 > **Year applicability:** Rules in this skill apply across **2024-25, 2025-26, and 2026-27** unless a specific section flags a year-dated change. The pack is read alongside the rate-bearing skills (`uk-income-tax-sa100`, `uk-national-insurance`, `uk-dividends`, etc.) which carry full 3-year tables. ## Verified rates & thresholds (accountant-reviewed) > Reviewed against the cited tax authorities by **James Power** on 2026-06-03. > Items flagged for further clarification are tracked separately and excluded here. > This block is generated from verified `skill_facts` — edit the facts, not the prose. ### Company Formation - **Pvt Ltd — min shareholders** — 1 shareholder + 1 director _(CA 2006)_ - **Pvt Ltd — min capital** — £1 (no statutory minimum) _(CA 2006)_ - **PLC — min paid-up** — £50,000 (25% = £12,500 paid up) _(CA 2006)_ - **LLP — min members** — 2 designated members _(LLP Act 2008)_ - **Online incorporation** — £100 _(Companies House)_ - **Same-day (software)** — £156 _(Companies House)_ - **Paper** — £124 _(Companies House)_ - **Annual confirmation statement** — £50 online / £110 paper _(Companies House)_ - **Annual accounts filing** — 9 months after year-end (private) _(CA 2006 s.442)_ - **CT600 filing** — 12 months after accounting period _(CTA 2010)_ - **CT payment** — 9 months + 1 day after period end _(CTA 2010)_ - **Confirmation statement** — Every 12 months _(CA 2006)_ - **PSC register** — Update within 14 days of changes _(CA 2006)_ - **VAT threshold** — £90,000 _(VATA 1994)_ ## Section 1 -- Quick Reference **Quick Reference** | Field | Value | | --- | --- | | Country | United Kingdom of Great Britain and Northern Ireland | | Currency | GBP | | Company registrar | Companies House -- companies-house.gov.uk | | Key legislation | Companies Act 2006; Economic Crime and Corporate Transparency Act 2023 | | Typical formation time | 24 hours (online); 8--10 days (paper) | | Corporate tax rate | 25% (main rate); 19% (small profits, taxable profits ≤ £50,000) | | Skill version | 1.0 | ## Section 2 -- Entity Types Comparison **Entity Types Comparison** | Feature | Sole Trader | Private Ltd (Ltd) | Limited Liability Partnership (LLP) | Public Ltd (PLC) | | --- | --- | --- | --- | --- | | Legal personality | No | Yes | Yes | Yes | | Liability | Unlimited | Limited to share capital | Limited to capital contribution | Limited to share capital | | Min. members | 1 | 1 shareholder + 1 director | 2 designated members | 2 directors + 1 secretary | | Min. share capital | N/A | £1 (no minimum prescribed) | N/A (capital contribution) | £50,000 (25% paid up = £12,500) | | Tax treatment | Income tax + NIC | Corporation tax | Partners taxed individually | Corporation tax | | Admin burden | Low | Medium | Medium | High | | Audit required | No | Only if thresholds exceeded | Only if thresholds exceeded | Yes | | Filing accounts | No | Yes (abbreviated for micro/small) | Yes | Yes (full) | **Recommended default:** Private company limited by shares (Ltd) for most commercial purposes. ## Section 3 -- Registration Process ### Step 1: Choose Company Name - **Name requirements** — Check availability on Companies House name checker; must not be identical to or "too like" an existing registered name; sensitive words (bank, royal, charity) require prior approval; must end in "Limited" or "Ltd" (or Welsh equivalents) ### Step 2: Prepare Incorporation Documents - **Required documents** — Memorandum of association -- subscribers confirm intention to form a company; Articles of association -- use model articles (SI 2008/3229) or bespoke articles; Form IN01 -- application for registration (submitted online as part of digital flow) _(SI 2008/3229)_ ### Step 3: Register with Companies House - **Registration method and fee** — Online: via Companies House Web Incorporation Service or software filing. Fee: £100 (online/software) or £124 (paper); same-day service £156 (software only). Provide: company name, registered office address, director(s), shareholder(s), SIC code, articles, share structure ### Step 4: Receive Certificate of Incorporation - **Certificate details** — Typically within 24 hours for online filings. Certificate confirms company number, date of incorporation, and registered office ### Step 5: Register for Corporation Tax with HMRC - **Registration deadline** — Must register within 3 months of starting to trade. Obtain Unique Taxpayer Reference (UTR) ### Step 6: Register for VAT (if applicable) - **VAT registration threshold** — £90,000 (2025/26 threshold) - **Voluntary registration** — Voluntary registration permitted below threshold ### Step 7: Set Up PAYE (if employing staff) - **PAYE registration** — Register as employer with HMRC before first payday ### Step 8: Register for Confirmation Statement - **Confirmation statement frequency and fee** — Annual confirmation statement due at least once every 12 months (£50 online / £110 paper) ## Section 4 -- Capital Requirements **Capital Requirements** | Entity Type | Min. Share Capital | Min. Paid-Up | Payment Timing | In-Kind Contributions | | --- | --- | --- | --- | --- | | Private Ltd | £1 (no statutory minimum) | No minimum paid-up requirement | On or after incorporation | Permitted (no independent valuation required for private companies) | | PLC | £50,000 | 25% (£12,500) + share premium | Before trading certificate issued | Permitted (independent valuation required) | | LLP | N/A | Members agree capital contribution | Per LLP agreement | Per LLP agreement | ## Section 5 -- Costs Breakdown **Costs Breakdown** | Cost Component | Amount (GBP) | Notes | | --- | --- | --- | | Companies House incorporation (online) | £100 | Standard service (~24 hours) | | Companies House incorporation (same-day) | £156 | Software filing only | | Companies House incorporation (paper) | £124 | 8--10 working days | | Annual confirmation statement | £50 (online) / £110 (paper) | Due every 12 months | | Registered office service | £50--£300/year | If using a service address | | Accountant fees (annual) | £500--£3,000/year | Varies by complexity | | Company secretary (optional) | £0--£500/year | Not required for Ltd | | **Total initial cost** | **£100--£300** | Government fees only; professional fees additional | ### Annual Maintenance **Annual Maintenance** | Item | Cost (GBP) | | --- | --- | | Confirmation statement | £50 | | Corporation tax filing | Included in accountant fees | | Annual accounts filing (Companies House) | Free | | Registered office | £50--£300 | | Accountancy fees | £500--£3,000 | ## Section 6 -- Post-Formation Compliance **Post-Formation Compliance** | Obligation | Deadline | Authority | | --- | --- | --- | | Confirmation statement | Within 14 days of review period end (annual) | Companies House | | Annual accounts | 9 months after financial year-end (private) | Companies House | | Corporation tax return (CT600) | 12 months after accounting period end | HMRC | | Corporation tax payment | 9 months and 1 day after accounting period end | HMRC | | VAT returns | Quarterly (MTD-compliant software required) | HMRC | | PAYE/RTI submissions | On or before each payday | HMRC | | PSC register (People with Significant Control) | Maintain and update within 14 days of changes | Companies House | | Register of members | Maintain at registered office | Internal | ## Section 7 -- Bank Account Opening ### Documents Typically Required - **Bank account documents** — Certificate of incorporation; Memorandum and articles of association; ID and proof of address for all directors and shareholders (25%+); Proof of registered office; Business plan or description of activities ### Typical Timeline - **Bank account opening timeline** — 1--5 working days (UK digital banks: Tide, Starling, Revolut Business); 2--4 weeks (traditional high-street banks) ### Common Banks Barclays, HSBC UK, Lloyds, NatWest (high street); Tide, Starling Bank, Revolut Business, Monzo Business (digital) ## Section 8 -- Foreign Founder Considerations **Foreign Founder Considerations** | Question | Answer | | --- | --- | | Non-resident directors allowed? | Yes -- no residency requirement for directors | | Minimum UK-resident director? | No (but at least one natural person aged 16+ required) | | Nominee shareholders permitted? | Yes (PSC register must still disclose ultimate beneficial owners) | | Apostille requirements | Foreign ID documents may need certified translation | | Physical presence required? | No -- entire process can be completed remotely | | Foreign ownership restrictions | None for standard Ltd; FCA-regulated activities require separate authorisation | | ID verification | From 2024, Companies House requires verified identity for directors and PSCs | ## Section 9 -- Common Mistakes and Refusals - **R-UK-F1 -- Shell company for fraud** — This skill will not assist in forming a company intended as a shell for fraudulent or money-laundering purposes. Under the Economic Crime and Corporate Transparency Act 2023, Companies House has enhanced powers to query and reject suspicious filings. _(Economic Crime and Corporate Transparency Act 2023)_ - **R-UK-F2 -- Using a fake registered office** — The registered office must be a genuine address where documents can be served. PO Boxes are not permitted. Virtual office services are acceptable if they provide a physical address and forward mail. - **R-UK-F3 -- Failure to disclose PSCs** — Every UK company must maintain a PSC register. Deliberate failure to identify and disclose people with significant control is a criminal offence. - **R-UK-F4 -- Trading without VAT registration** — If taxable turnover exceeds £90,000, VAT registration is mandatory. Trading above the threshold without registration risks penalties and backdated assessments. - **R-UK-F5 -- Dormant company misconception** — A dormant company still has filing obligations (annual accounts and confirmation statement). Failure to file leads to penalties and eventual compulsory strike-off. ## Section 10 -- Timeline **Timeline** | Step | Duration | Cumulative | | --- | --- | --- | | Name check and document preparation | 1--2 days | Day 1--2 | | File online with Companies House | 1 day | Day 2--3 | | Certificate of incorporation received | Same day to 24 hours | Day 2--4 | | Open business bank account | 1--5 days (digital) / 2--4 weeks (high street) | Day 3--28 | | Register for corporation tax (HMRC) | 1--7 days | Day 4--35 | | Register for VAT (if needed) | 1--30 days | Day 5--65 | | Set up PAYE (if employing) | 1--5 days | Day 6--70 | | **Ready to trade** | | **As fast as 2--3 days (digital bank)** | The UK has one of the fastest and cheapest company formation processes globally. ## Disclaimer This skill and its outputs are provided for informational and computational purposes only and do not constitute legal, tax, or financial advice. Open Accountants and its contributors accept no liability for any errors, omissions, or outcomes arising from the use of this skill. All outputs must be reviewed and signed off by a qualified professional before acting upon. The most up-to-date, verified version of this skill is maintained at [openaccountants.com](https://openaccountants.com). ## Talk to a verified accountant This skill is a tool, not an engagement. Every taxpayer's situation is different, and the rules in the skill may not match your specific facts. To speak with one of the licensed accountants who verifies skills for your jurisdiction — **no liability on either side until you and the accountant sign a formal engagement letter** — book a free 30-minute call: **→ [Book a call](https://calendly.com/openaccountants-info/30min)** We'll route you to the named verifier covering your country or state. You can also see the full list of verified accountants at [openaccountants.com/network](https://openaccountants.com/network).