“Companies in the UK” represent a vibrant and varied sector of the nation’s economy. From large public corporations to small private enterprises, these companies span across diverse industries such as finance, technology, and manufacturing, playing a significant role in driving the UK’s economic growth. Governed by the comprehensive framework of the UK’s Companies Act of 2006, these companies benefit from a clear structure for formation, operation, and governance. In the following paragraphs, we will delve into the two main types of companies in the UK – public and private companies. We will explore their differences, shedding light on their unique characteristics, benefits, and challenges. This exploration will provide valuable insights for both local and foreign entrepreneurs looking to navigate the UK business landscape.

The UK’s Companies Act of 2006

In 2006, the UK’s Companies Act underwent significant reforms. This legislation, one of the largest in English law, was revamped to reflect the reality of the business landscape. The narrative that companies are typically large conglomerates like Microsoft or Amazon was challenged. The truth is, most companies are small and private. The reforms made the Companies Act more accessible for small, private companies in the UK.

The Distinction in Names

The first major difference between public and private companies lies in their names. Every company in the UK must end with either “Limited” or “Public Limited Company”, or their abbreviations “LTD” or “PLC”.

Offering Shares

The second distinction revolves around the offering of shares. Only public companies in the UK are allowed to offer shares to the public. Private companies, on the other hand, do not have this privilege.

Size and Structure

The third difference is the general size and structure of these companies. Private companies in the UK are usually small, often with few shareholders and directors. In many cases, the directors are also shareholders. Conversely, public companies are typically larger, with a more dispersed ownership structure.


The final difference lies in the level of regulation. Public companies in the UK are often heavily regulated, both domestically and internationally. They must adhere to regulations at regional levels and sometimes even at an international level.

One such regulation, as specified in Part 20 of the UK’s Companies Act, is that a public company must have a minimum share capital. This requirement must be confirmed with a trading certificate.

Understanding the differences between public and private companies is essential for anyone involved in the business world. The UK’s Companies Act of 2006 provides a framework for these distinctions, making it easier for small, private companies to navigate the business landscape. As we move forward, we will delve into the actual law of limited liabilities and explore the existence of corporate group structures within English law. Stay tuned for more insights into the fascinating world of company law in the UK.

At JR & Firm LLC, we specialize in assisting with company formation in the UK, catering to both local and foreign clients. Our team of seasoned professionals offers tailored guidance based on your unique needs and circumstances. Whether you’re looking to establish a public limited company, a private limited company, or a single-member company, we’re here to simplify the process for you. Our goal is to help you navigate the legal and financial complexities of setting up a company in the UK, ensuring your business gets off to a strong start. With JR & Firm LLC, you can trust us to help lay the foundation for your business success.

1. Can a foreigner register a company in the UK?

Yes, a foreigner can register a company in the UK. There are no restrictions on foreign nationals being a UK company director, shareholder, or a secretary.

2. What are the requirements for registering a company in the UK?

The requirements include having at least one director (who is a natural person), one shareholder, and a registered office address in the UK. You also need to choose a company name and prepare documents such as the Memorandum of Association and Articles of Association.

3. Do I need to live in the UK to register a company?

No, you do not need to live in the UK to register a company. However, the company must have a registered office address in the UK.

4. What is a registered office address?

A registered office address is the company’s official address where all communications and notices from Companies House and HM Revenue and Customs (HMRC) are sent.

5. Can I use my home address as the registered office address?

Yes, you can use your home address as the registered office address, whether you are a local or a foreigner. However, it will be publicly available on the Companies House register.

6. How long does it take to register a company in the UK?

If you apply online, the process usually takes 24 hours. Postal applications can take between 8 to 10 days.

7. What is the cost of registering a company in the UK?

As of my knowledge cutoff in September 2021, the standard fee for online registration with Companies House is £12. Postal applications cost £40, or £100 for same-day processing.

8. Do I need a company secretary?

Since 2008, private limited companies in the UK are not required to have a company secretary, but they can choose to appoint one.

9. Can a single person register a company in the UK?

Yes, a single person can register a company in the UK. This is known as a single-member company.

10. What is a SIC code?

A SIC (Standard Industrial Classification) code is used to classify the business’s nature. You will need to provide at least one SIC code when registering your company.

11. What are the responsibilities of a company director?

A company director is responsible for running the company, making sure company accounts and reports are properly prepared, and ensuring the company pays its taxes.

12. Do I need to register for VAT?

You must register for VAT if your VAT taxable turnover is more than £85,000. You can voluntarily register if it’s below this, which could be beneficial in some cases.

13. What is a shareholder?

A shareholder is an individual or company that legally owns one or more shares in a company. Shareholders essentially own the company, and directors are appointed to manage it on their behalf.

14. What is share capital?

Share capital refers to the funds a company raises in exchange for issuing shares. The owners of these shares are the company’s shareholders.

15. What happens after I register my company?

After your company is registered, you’ll get a ‘Certificate of Incorporation’. This confirms that your company legally exists and shows your company number and date of formation.

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Jasur Mavlyanov, an experienced entrepreneur and legal expert, has built a notable career in international business, with a focus on China. With over 13 years of experience living and working in China, Mavlyanov has acquired valuable insights into the Chinese legal system and business environment.

As an entrepreneur, Jasur founded JR & Firm LLC, a company dedicated to providing legal services to global clients entering the Chinese market. His leadership has helped the firm become a reliable partner for businesses navigating the complexities of Chinese regulations and laws. READ MORE about Jasur.

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