Are you planning to start a new business in Scotland? Nothing can be more thrilling than starting your own business.
Starting a new business in Scotland requires careful planning and following legal procedures.
Indeed, Scotland offers a supportive business environment for new entrepreneurs and an extensive range of resources to set up their companies.
Understanding the government’s obligations to choosing the right business structure to register your company can be stressful. So, knowing how to register a business in Scotland will save you time and effort.
This guide offers a clear insight into registering your company in Scotland. Just continue reading this step-by-step guide and get ready to take the first step.
Company Structure in Scotland
You can structure your business in various ways in Scotland according to how you intend to perform your business.
The corporate structures include:
- Sole trader: This business structure is for entrepreneurs who operate a small-scale business in a self-employed manner.
- Partnership: This business structure includes Limited Liability Partnerships (LLP)
- Limited Company: This business structure can be either a private limited company or a public/listed company
- Scottish Limited Company: This business is incorporated in Scotland and should have a registered office in Scotland.
However, choosing the right business structure can be a daunting task. It has a significant impact on how you operate your business and legal obligations.
A Step-By-Step Guide to Register a Business in Scotland
The Companies House, the UK’s company register, manages business registration in Scotland.
The business registration procedure is no different from anywhere else in the UK.
Because Companies House manages the business registration procedure in the entire UK.
Here is a step-by-step guide that you can follow to register your company.
Step 1: Gather your documents
To register your business through Companies House, you will need the following documents:
- Your Business Name: You need to be sure that the name is unique.
- Your Business’s Registered Office Address: To this address, all official correspondence will be sent.
- Shareholder Detail: Mention the names who own a stake in the company
- Director Details: You need to mention the name, address, and occupation of the director
- SIC (Standard Industrial Classification code): This classifies your business’s activity
Step 2: Choose your business name
This step involves choosing a business name that is available to use. This involves a few crucial checks:
- Availability checks: You need to be sure that someone else has not taken your desired business name. Companies House will offer you access to a few tools to check the availability.
- Restrictions on sensitive words: Some restrictions are there on using a few words, such as “royal”. Before using these terms, you need to get approval from the Companies House.
- Use of Ltd.: For Private Limited companies, in the end, “Ltd” is essential.
Step 3: Choose your business registered office address
You need to choose your business’s registered office address, where all the official documents will be sent. The HMRC and Companies House may send you official documents to this address.
Some business owners provide a different address for their business. However, you can use your home address as your registered business address.
Step 4: You need to appoint directors
You need to appoint at least one director to register a private limited company in Scotland. The director will be legally responsible for the running of the business.
He/she will also be responsible for the legal obligations.
Step 5: Determine the share structure of your business
During the business registration process, you need to mention the share structure of your business.
You can mention the types of shares and the initial shareholdings of each shareholder. You should include the number of shares of your business.
Step 6: Prepare and file your documents
Once you have gathered all the required information and business details, you can submit them to the Companies House.
You can send the documents either online or by post. The online submission process is much quicker.
Step 7: Pay the registration fee
The business registration requires a fee, which varies depending on the processing option. You can choose either the standard or expedited processing option.
Step 8: Receive the Certificate of Incorporation
After successful business registration, you can receive the Certificate of Incorporation, The Companies House will issue you the certificate.
This certificate proves that your business is successfully registered in Scotland. Now, your business is considered a separate legal entity.
Navigating the Legal Systems Following Your Business Registration In Scotland
All UK businesses are incorporated under the Companies Act 2006. However, it will be worth remarking on the district legal systems, including Scotland.
Limited companies and Sole traders are liable to specific legislation and government licenses within the UK.
Since you have registered your business in Scotland, you need to adhere to Scots law regarding business-related subjects.
You can consult with a legal professional to ensure you are completely aware of Scots law. Then you can apply those laws to your business. You should set up your business in a way that meets Scottish law.
Wrapping It Up
Setting up a business in Scotland offers you numerous benefits. However, it is crucial to understand the practical and legal requirements before stepping inside the door.
From choosing a unique company name to understanding the responsibilities of Shareholders, every step is essential.
To help you, here we have discussed every aspect of how to register a business in Scotland.
You can follow each step very carefully and launch your business with confidence. However, you can seek help from an advisor for the success of your business.
