You’ve thought of the perfect name for a business, but you’re just not ready to start trading yet. Or, you really like a name and you simply don’t want anyone else to have it.
So, you’re thinking, can you reserve a company name?
Let’s take a look.
You can reserve a company name by registering it with Companies House
If you wish to start a business in the United Kingdom, you generally have two ways to proceed. You can set up as a limited company or operate as a sole trader. The model that is right for you very much depends on your circumstances.
By forming a limited company, you are stopping anyone else from forming another limited company with that name, or with a name that is similar. This is because all companies in the UK are registered with Companies House (the official registrar of companies) and placed on the Companies House register – where all company names must be unique.
Sole traders are not registered with Companies House and so are not placed on the Companies House register. This means that there is not as much protection when it comes to locking down a business name. However, sole traders do have the option to set up a limited company (to stop anyone else from forming a limited company with their business name) and then never trade with that company.
This is enabled by the fact that once a company has been formed, you are under no obligation to start trading with it. You can leave it dormant for as long as you wish. Whether this is a couple of months, a few years, or indefinitely – it’s up to you.
How to form a limited company
The process of forming a limited company is quick, simple – and one we can help with through our various company formation packages (prices start at £12.99).
There are a number of business structures that sit under the ‘limited company’ banner. These include private companies limited by shares, private companies limited by guarantee, limited liability partnerships, and public limited companies. It doesn’t matter what type of limited company you form, all of them are placed on the Companies House register and so stop anyone else from forming another company with the same name.
However, a private company limited by shares is the most popular limited company. To form this type of company, you will need:
- A unique company name (you can check if your company name is available with our free company name search tool)
- A registered office address based in the UK (a number of our packages allow you to use our address)
- Details for the company director(s) – the director is the person tasked with the general day-to-day running of the company
- Details for the shareholder(s), including how many shares are to be allotted – the shareholder is the owner of the company
- Details for the person/people with significant control (PSC) – the PSC is the person who holds ultimate control of the company
You only need one person to form a private company limited by shares. This person would act as a director, shareholder and PSC. Alternatively, multiple people can be involved in the company.
If you do choose to form a limited company with us, once you’ve picked your package, we’ll take you through the online company formation process, right up to submitting your application to Companies House. We’ll then email you as soon as your company has been formed.
How to maintain a company that doesn’t trade
There are three things you must do to ensure your company is dormant and compliant:
1. Tell HMRC
Shortly after your company has been formed, you will receive a letter from HMRC (sent to the registered office) with the company’s Unique Tax Reference.
Using the correspondence details in this letter, write back to HMRC notifying them that the company will be dormant until further notice.
2. File a confirmation statement on an annual basis
All limited companies need to file a confirmation statement with Companies House on an annual basis. This report details basic information about a company.
This is a requirement for both trading and non-trading companies.
3. File dormant company accounts on an annual basis
All companies need to file annual accounts on an annual basis. This report details financial information about a company.
Dormant companies can file a specific set of accounts known as dormant company accounts.
Other steps you can take to protect your company name
There are a few more things you can do to ensure the safety of your company name:
Register your domain names
Even if you have no intention of trading online, ensure no one else sets up an online presence that could be mistaken for yours by registering any domain names relevant to your business name.
To give you a headstart, all of our company formation packages include a free .co.uk or .com domain name (provided by Names.co.uk).
Register a trade mark
If you want your name truly locked down you should consider registering a trade mark.
The cost for registering a single trade mark in one class is £170 (with an extra £50 for each additional class).
Our reserve a company name service
As well as our regular company formation packages, we also provide a reserve a company name service (priced at £59.99). It’s perfect for customers who wish to set aside a company name for their own use, but aren’t quite ready to trade yet (or never intend to trade).
We’ll walk you through the company formation process, provide you with a template for notifying HMRC that your company is dormant, and take care of your confirmation statement and dormant company accounts.
You then have the option to renew the service on an annual basis, and if you do ever decide to start trading, no problem – the company will be ready and waiting for you.
So there you have it. How do you reserve a limited company name? You form a limited company with that name!
We hope you have found this blog post helpful. Please leave a comment if you have any questions.