How to Open a Business in UK

Starting a business in the UK is easy if you follow the proper legal steps and prepare the necessary documents. This guide outlines the most common business structures, the formal requirements for creating an entity, how to open a UK business bank account, and the visa options frequently used by foreign investors and founders. It’s all presented in clear, actionable language for international clients. 

Most-used business structures in the UK 

Choose the structure that matches liability, taxation, and governance needs. The four common options are: 

Sole trader 

A sole trader is the easiest type of business to start and manage. As a sole trader, you make all the decisions and keep all the profits after paying taxes. 

Limited Liability Partnership (LL) 

A limited liability partnership is a separate legal entity from its members (partners), who are only liable for the amount of money they invest, plus any personal guarantees. The partnership is incorporated at Companies House and can only be used by profit-making businesses. 

The LLP itself does not pay UK corporation tax; instead, profits and losses are passed directly to the individual members who are taxed on their share.

Private Limited Company (Ltd) 

When you run a limited company, you have some legal, financial, and other responsibilities. 

A limited company offers ‘limited liability.’ This means owners are only responsible for business debts up to the amount they invest. This protection can help you if things don’t go well.  

There are rules to follow when you take money out of a limited company. Limited companies can also apply for business loans and investments.

Public Limited Company (PLC) 

A UK public company is a Public Limited Company (PLC), a legal structure allowing shares to be sold to the public on stock exchanges like the London Stock Exchange, enabling large capital raising with strict financial reporting and oversight. 

Requirements to establish an entity in the UK 

1. Company Name: The name must follow specific rules. 

2. Registered Office Address: The registered office must be in the UK and cannot be a PO Box. New laws require that addresses be checked more carefully. 

3. Directors: A private company must have at least one director who is a person. Directors need to verify their identity with Companies House according to the law. 

4. Shareholders and Share Structure: You must provide details about the shareholders, how shares are structured, and the articles of association (the rules for managing the company). 

5. People with Significant Control (PSC): You must disclose information about people who have significant control, including their names, dates of birth, and the type of control they have. Companies' House requires these disclosures.  PSCs need to verify their identity with Companies House according to the law. 

How to Open a UK Business Bank Account 

To open a business account in the UK, follow these steps. It is essential for trading, managing payroll, and gaining investor confidence. 

Who can open an account? 

UK-registered companies and sole traders can open accounts with UK banks. Some banks allow non-resident directors or foreign-owned companies to apply, but this varies by bank. Be ready to provide documents to prove your identity, address, and source of funds. 

Typical papers banks request 

• Certificate of incorporation, articles of association, and updated registers.  

• Proof of the company's registered address and operational address (if different). 

• Passports or government ID for directors and beneficial owners (UBOs/PSCs). 

• Proof of business activity (website, contracts, client invoices) and proof of source of funds for initial deposits. 

Practical Timeline and Process 

Establishing a business bank account in the UK often requires more time than entrepreneurs anticipate. Although some digital banking providers may expedite the onboarding process, traditional banks generally take several weeks, and in certain instances, the process may extend to a few months for approval. This duration is indicative of the necessary due diligence protocols, which encompass identity verification, checks on beneficial ownership, and anti-money laundering evaluations. These measures are particularly rigorous for companies owned by foreign entities or for directors who are not residents. Therefore, it is crucial to plan this timeline proactively to mitigate potential delays in operations, payroll, or commercial activities. 

Do foreign investors need a visa to open a business in the UK? 

UK company law allows a foreign national to incorporate and own a British company without a visa. You can register a limited company, be a shareholder and director, and operate the business from abroad without residing in the UK. This process neither grants nor requires the right to live or work in the country. 

On the other hand, if you want to set up and run an innovative business in the UK that’s different from anything else on the market, you can apply for an Innovator Founder visa.  The requirements to be met for this type of visa are that the business is: 

• new - you cannot join a business that is already trading 

• innovative - you must have an original business idea which is different from anything else on the market.

• viable, with potential for growth
  

• scalable - you must give evidence of planning that includes creating jobs and growing into national and international markets.

How We Support Your Expansion into the UK 

We bring extensive experience in global expansion, merging regulatory expertise with practical execution. We collaborate with founders, investors, and executive teams to minimise risks, speed up timelines, and ensure full compliance with UK corporate, tax, and governance standards. This approach creates a strong operational foundation, allowing your business to focus on growth with confidence. 

Expanding into the UK is a strategic decision, and with H&CO, it becomes a structured, secure, and effectively executed reality. 

This content is for informational purposes only and does not constitute legal, tax, or immigration advice. Regulations may change, and H&CO assumes no liability for actions taken based on this information.