Set up and register a limited company (private or public)

Types of limited company

There are four main types of company:

private company limited by shares
private company limited by guarantee
private unlimited company
public limited company (plc)

Most small and medium-sized businesses that opt for limited company status become private limited companies.

Private company limited by shares

Most private limited companies are owned by their shareholders and are limited by shares. This means that the liability of each member is limited to the amount unpaid on shares held by them.

Private company limited by guarantee

Companies limited by guarantee do not have shares, and its members are guarantors rather than shareholders. The members' liability is limited to the amount they have agreed to contribute to the company's assets if it is wound up. This structure is often used by charities, Right to Manage, commonhold companies and social enterprises to limit the personal liability of their directors and trustees. See our guide on how to set up a social enterprise.

Private unlimited company

This type of company may or may not have a share capital but there is no limit to the members' liability. There are relatively few unlimited companies.

PLCs

This type of company has a share capital and limits the liability of each member to the amount unpaid on their shares. PLCs:

can raise money by selling shares on the stock market
must have share capital of at least £50,000 or the prescribed equivalent in euros
must have at least two directors and a qualified company secretary

See the page in this guide on requirements for public limited companies.

A private company limited by shares can convert into a plc, but it will need to re-register in order to do this. For more information on changing from a private limited company to a plc, see our guide on company changes you must report to Companies House.

Naming your company

You cannot choose a name that is the same as an existing company and you should avoid a name:

that people may find offensive
that is 'too much like' an existing company name unless it is part of the same group

You will need to obtain special approval for a name that:

Suggests a connection to a government department, a devolved administration, a local authority or specified public body.
Includes any sensitive words and expressions that require approval from Companies House. For example, you are not allowed to choose a name which includes words that are potentially misleading, such as 'international' if you are a UK-only business.

See our guide on how to choose the right name for your business.

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