Clearly, you need some good news, and I’ve got some. You see, setting up a limited company is a relatively quick and painless process when compared to many business practices.
If you’ve already trawled the internet, you may have seen wildly different answers ranging from 5 minutes to several weeks. The reason for this is there are a few constituent elements which make up the registration process. The speed they complete depends very much on whether or not you want to do it yourself or employ a professional.
How long will it take to set up my limited company?
This depends very much on the route you choose. If you fancy the DIY method, you’ll start by completing the seven step registration process on the Gov.uk website. Once done, your online application should be registered within 24 hours. If you’d rather do it via post, the processing time jumps up 8-10 days and you’ll pay a premium.
If you decide on an accountant to set up your limited company, you must factor in their quoted lead time. I’d suggest allowing up to two weeks in this case, depending on how busy they are.
You should also allow time for devising your company name. It is possible to buy ready-made limited company names, but far more preferable to come up with your own. In order to do so, you must send a memorandum of association (the company name, registered office and nature of your business), completed IN01 form and articles of association (this sets out the rules for the running and regulation of the company) to Companies House. Happily, this is all part of the Gov.uk registration process.
All that then remains is the VAT registration (allow a couple of weeks) and your bank account which could take anything from 5-10 working days. Much of your time will be spent waiting for the latter elements to be confirmed. However, this will not prevent you from invoicing and getting your business off the ground!
Is a limited company right for me?
Unlike a sole trader, a limited company is a separate legal entity with its finances removed from those of the owner(s). That means it is responsible for it’s own actions but must have one or more shareholders.
You should do your research and talk to financial advisor or accountant to make sure a limited company is the right step forward. There are tax savings to be had, but you need to be confident your projected revenue and on-going investment is a solid enough footing for a limited company.