Company Formation & Entity Setup in United Kingdom
Private limited company and LLP incorporation via Companies House, HMRC corporation tax registration, and post-formation compliance setup.
United KingdomCurrency
GBP
Legal forms
Private Limited Company (Ltd) · Public Limited Company (PLC) · LLP
Minimum share capital
Private limited company: none required (typically 100 shares of £1) · PLC: £50,000
Registration body
Companies House, with separate HMRC registration for Corporation Tax required within 3 months of starting to trade
Formation timeline
24 hours for standard online incorporation; 8–10 days by post
Corporate tax rate
25% main rate (profits > £250,000) · 19% small profits rate (profits < £50,000) · marginal relief between the two (effective ~26.5% at the margin)
How company formation works in United Kingdom
The United Kingdom applies a 25% main rate of corporation tax on profits above £250,000, with a 19% small profits rate below £50,000 and marginal relief tapering the effective rate between the two bands — a structure unchanged for the 2026/27 financial year, but one where profit within the marginal band is taxed at an effective rate of approximately 26.5% on each additional pound, higher than either headline rate. VAT is charged at a standard 20%, with a £90,000 registration threshold — among the more straightforward tax regimes across HTLC's country practices.
Discuss your United Kingdom market-entry structureMatched to your business objective
Private Limited Company (Ltd)
The standard vehicle for an operating subsidiary of a foreign company — the default choice for most market-entry engagements in United Kingdom.
Public Limited Company (PLC)
Used for larger operations, more formal governance needs, or entities seeking to raise capital publicly.
LLP
Used for larger operations, more formal governance needs, or entities seeking to raise capital publicly.
Branch
Useful for testing the United Kingdom market before committing to a subsidiary, or for keeping a single legal entity across borders. Creates a taxable presence — profits are generally taxed in United Kingdom.
Representative office
For market research and liaison activity only — cannot sign contracts, invoice, or trade locally in most jurisdictions.
What it takes to register, and how long
Formation runs through the Companies House, with separate HMRC registration for Corporation Tax required within 3 months of starting to trade, typically taking 24 hours for standard online incorporation; 8–10 days by post.
- Sponsor licence required for every non-UK hire — — including EU nationals, who lost automatic right to work when free movement ended on 1 January 2021; without a licence there is no legal route to employ them
- Per-pay-period salary check from 8 April 2026 — — sponsors must show the Skilled Worker salary threshold is met in each pay period, not as an annual average, closing the gap that bonus- or commission-weighted packages previously used
- Marginal relief band (£50,000–£250,000 profit) — — the effective corporation tax rate on income within this band reaches approximately 26.5%, higher than either the 19% or 25% headline rates, making profit-timing genuinely consequential near the boundary
- Audit exemption thresholds — effective from 6 April 2025 — small company: turnover < £15M, gross assets < £7.5M, < 50 employees (2 of 3 criteria, in both the current and preceding financial year)
Frequently asked questions
Talk to a United Kingdom formation expert
Immigration, not tax, is the structural risk companies underestimate in the UK: a sponsor licence takes time to obtain and is now checked at the level of each individual payslip, not the year as a whole. Companies planning to hire non-UK staff — EU nationals included — should secure sponsor status well ahead of the intended start date, not treat it as a formality alongside the job offer.