How Much Does It Cost To Set Up A Limited Company?

Starting a business is exciting. But before you get stuck into choosing a name, building your website and finding your first customers, there's one question you’ll probably want answered:

How much does it actually cost to set up a limited company?

The good news is that forming a limited company doesn't have to cost a fortune. The standard Companies House registration fee is £50 for an online application. But that's only one part of the picture. Depending on your business, you may also need to budget for things like an accountant, registered office address, insurance, software and professional advice.

So, what should you expect to pay?

Here's our Start Up A-Z guide to the costs of setting up and running a limited company.

Cost breakdown: at a glance

Here's a quick look at some of the main costs you might need to consider:

The exact amount you'll spend depends on the type of business you're starting and how much you choose to do yourself.

Let's break those costs down.

Detailed breakdown of limited company setup costs

Companies House registration fee

The first cost you'll come across is the Companies House registration fee.

The standard fee for registering a limited company online is £100. A paper application costs £124. These fees cover the official incorporation of your company and registration of its details.

And this is where SUAZ can help.

Start Up A-Z offers company formation in as little as two minutes, helping you get your business officially registered while supporting you through the process and introducing you to trusted partners.

Form your company with SUAZ for free

Company formation agent fees

You don't have to register your company directly with Companies House. You can use a company formation agent to handle the process for you.

Basic formation packages typically cost around £100 to £150, although more comprehensive packages can cost more.

Why use one?

The benefits

• Simplicity: Someone else can guide you through the incorporation process.

• Speed: It can make getting your company set up quick and straightforward.

• Convenience: Formation agents can take care of much of the administration.

• Compliance support: They can help you avoid common formation mistakes.

• Additional services: Some providers offer extras such as registered office addresses and business support.

The downside is that you're normally paying more than you would for a direct Companies House application.

Unless you use SUAZ — we don't charge for our services, you only pay the companies house formation fee

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Registered office address

Every limited company needs a UK registered office address. This is the official address where Companies House correspondence and certain legal documents can be sent.

There are several options available.

Use your home address

This won't cost you anything, but there is an important consideration: your registered office address is publicly available on the Companies House register.

If you'd rather keep your home address private, or simply want your business to have a more professional-looking address, you may want to consider an alternative.

Use your accountant's address

Some accountants include a registered office address as part of their services. Others offer it as an additional service.

The cost can vary, with the brief estimating around £50 to £200+ per year.

Use a dedicated registered office service

A dedicated registered office service gives your company a separate physical business address.

These services can cost around £20 to £100 per month, depending on the provider and what's included.

Use a virtual office

If you're looking for more than simply an address, a virtual office can provide services such as mail forwarding and telephone support.

Prices vary significantly, with packages ranging from around £10 to £200+ per month.

Start-Up A-Z have partnered with Desk Mate, who offers virtual office services from £7.99 + VAT per month, including secure mail handling and business support. With offices across the UK, DeskMate are our chosen partner for Virtual Office services.

Accountant fees

You don't have to hire an accountant, but professional financial support can be extremely useful when you're running a limited company.

An accountant can help with areas such as:

• Tax compliance

• Financial planning

• Payroll

• Annual accounts

• General financial guidance

The amount you'll pay depends on the services you need, the size of your business and the accountant you choose.

For basic services, the brief estimates £500 to £1,200+ per year. A one-off advice session could cost around £100 to £300.

When you're starting out, don't be afraid to shop around. Different accountants offer different packages, so find one that fits the size and needs of your business.

Business bank account

Keeping your business finances separate from your personal finances is an important part of managing a limited company. A dedicated business bank account can make it much easier to track your income, expenses and cash flow.

The cost can vary.

Some banks offer free basic business accounts, while others charge a monthly fee. You may also find introductory offers where fees are waived for the first 12 or 18 months.

Just remember to check what you'll pay once any introductory period ends.

Business insurance

Insurance is another cost worth considering when you're setting up your company. The type of cover you'll need depends on what your business does, whether you employ people and the risks involved.

Employers' liability insurance

If you employ staff, employers' liability insurance is a legal requirement.

Costs can range from £60 to £300 per employee per year, although higher-risk businesses may pay more.

Public liability insurance

Public liability insurance can protect your business against certain claims made by members of the public.

Costs can vary significantly, from around £50 to £5,000 a year, depending on your business and level of risk.

Professional indemnity insurance

If your business provides professional advice, services or consultancy, professional indemnity insurance may be worth considering.

It can help cover compensation and legal costs arising from certain claims made by clients. The brief gives a typical range of around £60 to £120 a year for small businesses, although costs can vary.

Cyber insurance

If your business relies heavily on computers, data or online systems, you might also consider cyber insurance.

Costs range from around £90 to more than £3,500, depending on your circumstances and level of cover.

Initial software subscriptions

These days, even the smallest businesses often rely on software to keep things running.

You might need accounting software, payroll software, a CRM system, project management tools or a website builder.

Basic software subscriptions can start at around £10 to £15 per user per month.

Some of the software you might want to consider includes:

Accounting software: Tools such as Xero, QuickBooks and FreeAgent can help with bookkeeping, invoicing, VAT returns and financial reporting. The brief estimates around £10 to £50 per month.

Payroll software: If you're employing people, payroll software can make managing payroll easier. Costs can start at around £5 to £30+ per employee per month.

CRM software: Customer relationship management software helps you organise customer information and interactions. Entry-level packages typically cost around £10 to £30.

Project management software: These tools can help you organise tasks, projects and your team. Basic plans can cost around £5 to £20 per month.

Don't feel like you need every piece of software available. Start with what you actually need and add more as your business grows.

Other potential initial costs

The costs above cover many of the essentials, but there are a few other expenses you might need to budget for.

Legal advice

Legal advice can be useful when you're dealing with things such as shareholder agreements, contracts and employment arrangements.

Legal fees can cost around £200 to more than £750 per hour, depending on the service and professional you use.

You might not need ongoing legal support, but having access to professional advice when something important comes up can be valuable.

Trademarking

Your business name and branding are important assets, so you may want to consider protecting them.

The cost is £205 for a basic trade mark application since the price change in early 2026.

Before applying, make sure you understand the relevant trade mark requirements and check that your chosen brand is available.

Website and branding

Your business needs somewhere for customers to find you.

Depending on your needs, a website and branding could cost anywhere from around £500 to £5,000+. Doing some of the work yourself can reduce the initial cost, while hiring professionals will generally increase it.

You don't necessarily need a huge website when you're starting out. A simple, professional online presence can be enough to get you moving. A company such as Startup Studios, are experts in startup and small business websites. They provide high-quality websites for a fraction of the cost of a typical design business, making them ideal to get your business started.

Initial stock and equipment

This is one of the costs that's hardest to put a figure on.

A consultant working from home might need little more than a laptop, while a retailer, manufacturer or tradesperson could need thousands of pounds' worth of stock, tools or equipment.

Think about what you genuinely need to start trading and avoid buying everything upfront if you don't have to.

Licences and permits

Some businesses need specific licences or permits before they can operate.

Costs vary considerably, so check which licences apply to your business using the GOV.UK licence finder and then check with your local authority for any relevant fees.

What about ongoing costs?

Setting up your limited company is only the beginning. Once you're trading, there are some recurring costs you'll need to factor into your budget.

Annual Companies House filing fees

A limited company needs to keep its Companies House information up to date.

An online confirmation statement costs £50, while it now costs £110 for a paper filing.

Accountant fees

If you use an accountant, you'll need to continue budgeting for their services.

Many accountants offer monthly or quarterly packages, so work out the annual cost and include it in your regular business expenses.

Software subscriptions

Those monthly software costs don't disappear after you've launched.

Accounting, payroll, CRM and project management tools can all become ongoing business expenses.

Professional development and training

As your business grows, you and your employees may benefit from training and professional development.

It can be another expense to budget for, but developing your skills can also help your business stay competitive and keep up with changes in your industry.

Tax liabilities

You'll also need to account for your company's tax obligations.

These can include:

• Corporation Tax on taxable company profits.

• VAT, if your business meets the relevant registration requirements.

• PAYE and National Insurance where you employ staff or pay relevant amounts through payroll.

Make sure you understand which taxes apply to your particular business and keep enough money aside to meet your obligations.

How to save money when starting a limited company

Starting a business doesn't mean you have to spend thousands before you've made your first sale.

There are plenty of ways to keep your initial costs under control.

Do it yourself

If you have the skills and confidence, consider handling some tasks yourself.

From registering your company to creating your initial branding, doing things yourself can reduce your upfront costs.

Just don't DIY something simply because it's cheaper if you don't have the knowledge to do it properly. It's better to spend money to do something properly, than to do it yourself and pay to have it fixed further down the line.

Choose a basic formation package

If you use a company formation agent, start with the basics.

You can always add additional services later when you understand what your business actually needs.

Shop around for an accountant

Don't automatically choose the first accountant you speak to.

Compare packages, ask what's included and look for services designed for startups and small businesses. You may find that starting with basic services and scaling up is more cost-effective.

Look for a free business bank account

Some challenger banks offer free basic business accounts or introductory fee-free periods.

Just make sure you understand the terms and what you'll pay after any introductory offer ends.

Prioritise essential insurance

Insurance is important, but you don't necessarily need every type of cover from day one.

Think carefully about the risks your business actually faces and make sure you have the appropriate protection in place.

Use free software trials

Many software providers offer free trials or basic free versions.

They may have fewer features, but they can be a good way to work out what you actually need before committing to another monthly expense.

Start lean

Perhaps the simplest money-saving tip is to start lean.

Don't spend money just because you can. Focus on the things that help you launch, serve your customers and make your first sales. You can invest more as your business grows.

Beyond the cost: why set up a limited company?

It's easy to focus on the costs when you're starting out. But it's also worth thinking about what you're getting in return.

Limited liability

A limited company is a separate legal entity from you.

This means that, in general, the company's liabilities are separate from your personal finances, helping to protect your personal assets from business debts and liabilities, subject to the usual exceptions.

Professional image

Operating through a registered limited company can help create a professional image and may give potential customers, suppliers and partners greater confidence in your business.

Potential tax advantages

A limited company has a different tax structure from a sole trader, and depending on your circumstances, it can be tax-efficient.

However, tax treatment varies depending on your income, profits and how you take money from your company, so it's worth getting professional advice before deciding which structure is right for you.

Easier to raise capital

Limited companies can issue shares, which can make it easier to bring investors into the business if you're looking to raise capital and grow.

Succession planning

Because a limited company is a separate legal entity, ownership can be transferred or sold, which can make future succession planning easier.

So, how much does it cost to set up a limited company?

There's no single figure that applies to every business.

At the most basic level, you could start with the £100 Companies House registration fee and keep your other initial costs relatively low by doing things yourself.

But if you need an accountant, registered office address, insurance, software, legal advice, branding and other business essentials, your costs will quickly increase.

The important thing is to create a budget based on your business rather than someone else's.

Think about what you need to start trading, what you can do yourself and which services are worth paying for. Then build your budget around those numbers.

Ready to get started?

Setting up a limited company is an investment in your business, but it doesn't have to break the bank.

From choosing affordable formation services and finding the right registered office address to comparing accountants and making the most of free software trials, there are plenty of ways to keep your costs under control while you get your business off the ground.

And that's where SUAZ comes in.

Start Up A-Z is here to help you get your business started, with free company formation and support designed to help you take those first steps with confidence. 

Ready to make your business official? Form your company with SUAZ for free today.