One of the most common questions we get asked is: "How much does it cost to set up a limited company in the UK?" The honest answer is — it depends on how you do it and what services you need. The Companies House fee alone is just £50, but there are other costs to consider, both at the point of formation and on an ongoing annual basis.
This guide breaks down every cost in detail, so you can plan accordingly and understand which charges can change.
One-Time Formation Costs
These are the costs you'll encounter when registering your company. Most are optional or avoidable — but it's important to understand what each one covers.
| Cost Item | Typical Cost | Notes |
|---|---|---|
| Companies House fee (online) | £50 | The official government registration fee. Same-day electronic processing. |
| Companies House fee (paper) | £71 | Paper IN01 form. Slower processing — not recommended. |
| Formation agent fee | £0–£150 | Varies by provider. Some charge nothing; others charge up to £150 for premium packages. |
| Solicitor (bespoke incorporation) | £300–£1,500+ | Only needed for complex share structures, joint ventures, or investor-grade articles. |
| Bespoke Articles of Association | £200–£800 | Standard Model Articles are free. Bespoke versions are only needed for specific requirements. |
| Registered office address (first year) | £0–£120/yr | Required. Can be your home (free) or a professional service address. |
| Total via partner route | Check current fees | Any Tide offer is subject to current provider terms and eligibility. |
Partner offers explained: If a Tide offer is shown during the formation journey, review its current fee, account, reimbursement, and eligibility terms directly with Tide. Third-party offer details can change and are not guaranteed by Sterling Formations.
Annual Ongoing Costs
Formation is a one-time cost, but running a limited company involves recurring annual expenses. Understanding these helps you budget properly.
| Cost Item | Typical Annual Cost | Notes |
|---|---|---|
| Confirmation Statement | £34/yr | Filed with Companies House annually. Paper filing costs £62. |
| Annual accounts filing | £0–£300+ | Micro-entity or dormant accounts can be filed for free using free software. Accountants may charge £150–£300+ for preparation. |
| Corporation Tax return (CT600) | £0–£1,000+ | Depends on complexity. Many small companies include this in an accountant package. Can be filed yourself using HMRC's free tools. |
| Accountant (full service) | £500–£2,000+/yr | A good accountant covers CT600, annual accounts, payroll, VAT, and director self-assessment. Costs vary by turnover and complexity. |
| Registered office address | £50–£150/yr | If using a professional service address rather than your home. |
| Business address (mail forwarding) | £50–£200/yr | Optional. Separate from registered office. Keeps your trading address professional. |
| PAYE administration | £100–£400/yr | If using a payroll bureau or accountant to run your monthly payroll. Free if you do it yourself via HMRC Basic PAYE Tools. |
| VAT returns (if registered) | £200–£600/yr | Often included in an accountant package. Free to file yourself via HMRC's VAT online portal. |
| Business bank account | £0–£15/mo | Many business accounts are free for the first year. Tide's free account has no monthly fee. |
What's Included vs What Costs Extra
Included in basic formation
- Certificate of Incorporation
- Memorandum & Articles of Association
- Company Registration Number (CRN)
- Companies House WebFiling access
- First Confirmation Statement period
- Public register listing
Costs extra / purchased separately
- Registered office address service
- Business address (trading address)
- Accountancy & bookkeeping
- Payroll administration
- VAT registration & return filing
- Director self-assessment tax returns
- Business insurance
What Does It Really Cost to Run a Limited Company?
For a straightforward owner-managed limited company with modest turnover, the realistic annual running cost is:
Against the tax savings available to a limited company director earning £50,000+ per year (typically £5,000–£8,000 per year compared to sole trader), the admin cost pays for itself many times over.
Ready to form your company?
Register your UK limited company today — the Companies House filing fee (£50) is reimbursed when you open a Tide business account. Eligibility criteria apply.
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