Can you register a business for free?

In the early days of running a business, it’s important to adopt a lean approach and avoid spending wherever possible. Unfortunately, some fees begin accumulating from day zero; including the cost of registering your company.

As of May 2024, Companies House charges £50 for incorporation – rising to as much as £78 for same-day incorporation. It’s a frustrating amount for entrepreneurs to splurge on when starting a new business.

Founders cannot completely avoid paying this fee. You have to spend money to make money, as they say. But with a few savvy, cost-saving moves, you can reduce your overall bill dramatically. We’ll explain how in the guide below.

Is it possible to register a company for free?

It is not possible to register a new company without paying a fee. We’ll keep reiterating that throughout this article because it’s a myth that still confuses many entrepreneurs today.

If you register your company yourself, you’ll pay the fee charged by Companies House. The government increased the rates earlier this year.

Since May 1, those who register online will pay £50. This rises to £71 if you apply by post – in fact, you’re obliged to apply by post if you do not want to use ‘limited’ in your firm’s name.

Company founders must register their firm at least three months after they begin trading. Companies House usually creates a company in one business day, but if you’ve left things late, you can also pay £78 for same-day incorporation.

🚨 Stay alert to Companies House scams in which bad actors contact company directors to demand you pay a hefty (fake) renewal fee.

Can you save on the Companies House fee?

The rumours that you can sign up to Companies House at zero cost largely originate from small, lesser-known organisations who are trying to upsell their registration services. Many claim to cost nothing, but then use drip pricing to introduce hidden charges down the line.

It’s not all duplicitous, though. Incorporation is complicated, and a third-party expert can walk first-time founders through the process. Transparent registry services will also cover some of the fee. You won’t get away with spending nothing, but you will spend a lot less.

Tide’s company registration service, authorised by Companies House, is a good example. It lowers the cost of registration to just £14.99 for new companies with one shareholder. The service also offers access to Tide’s free Company Name Checker, drastically speeding up the application process.

By using the service, you’ll automatically be assigned a free Tide business bank account and you can add-on a virtual office, although Tide makes it clear the latter costs £12.71 a month.

In all, this works out as a pretty good deal. A new founder who uses Tide can sort their business’ incorporation, premises, and bank account in one month, for just over half the cost of the usual Companies House registration fee.

Do you have to register with Companies House?

Whether or not you need to register with Companies House will depend on your business structure. Specifically, this comes down to whether you are registering as a sole trader or a limited company.

Sole traders (also known as a sole proprietor or sole proprietorship) do not legally have to sign up to Companies House. They should register for Self Assessment with HMRC in order to pay themselves and record their profits, however.

Those who are running a limited liability company have more tax obligations, and must legally register with Companies House in order to begin trading. Small businesses are private limited companies, meaning their shares are not publicly listed.

This isn’t just a matter of red tape. Registered firms benefit from a raft of protections. Crucially, if they run into financial trouble, the founder’s personal wealth stays safe. It will also be harder for rivals to take your name or brand (although a trademark is needed to solidify a legal claim).

This is why, while the majority of entrepreneurs begin operating as a sole proprietorship, most will then make the smart move to incorporation once they’ve found their feet.

What details do you need to submit when registering a company?

Registering with Companies House can feel a bit daunting. But as long as you have all the correct information, it shouldn’t take more than an hour (or less, if you’re using a registration service like Tide’s).

Once you’ve confirmed that your desired company name hasn’t already been registered, you’ll be asked to supply your full name, plus the names of your shareholders or guarantors. You might also be asked for your’s and your shareholder’s:

• Town of birth
• Mother’s maiden name
• Father’s first name
• Telephone number
• National insurance number
• Passport number

As of March 2024, UK companies are now required to provide a contact email and an “appropriate” business premises address (which essentially means not a PO Box).

Both of these will be published online, so it’s best to create a free business email rather than share your personal details publicly. Or, as mentioned, you can use Tide’s virtual office address service, which supplies a professional-looking postcode.

Ready to register?

We like to imagine starting a business as a smooth path to sales, profits, and success. In reality, it involves a fair share of fiddly admin tasks with their share of fees attached.

But entrepreneurs are naturally shrewd. They know that by seeking out deals, or using government-backed registry services, including Tide’s registration deal, they can save their pennies to start as they mean to go on: protecting budgets and getting more bang for their buck.