Starting a business with someone you trust is exciting — registering it as a limited company makes it real. But two founders means twice the decisions: who owns how much, who runs the company, and what happens if you disagree.
Yes — two or more people can register a limited company together in the UK. Each partner becomes a director, a shareholder, or both, and you split the company’s shares between you. It costs £100 online, takes about 24 hours, and every director must verify their identity first.
If you have not read the main guide yet, start with our step-by-step guide to register a limited company in the UK, then come back for the partner decisions.
A limited company is not a partnership — do not mix them up
The words sound alike, but the law treats them very differently. A business partnership is two or more self-employed people trading together with no separate legal identity — the partners are personally responsible for its debts. A limited company is a separate legal person of its own. When you and your partner register one, you are not forming a partnership at all: you become shareholders who own the company and, usually, directors who run it. The company’s debts belong to the company, not to either of you personally.
5 decisions to agree before you file anything
1. How will you split the shares? Shares decide how much profit each of you can take as dividends and how much voting power each of you has. A 50/50 split feels fair — but read the deadlock section below first. A 60/40 or 70/30 split reflects who puts in more money, time or experience. Anyone holding more than 25% of the shares is a Person with Significant Control (PSC), and Companies House must be told.
2. Who will be a director? A company needs at least one director and there is no maximum, so both partners can be directors — most co-founders choose this, so both can sign contracts and open the bank account. A director must be at least 16 and must not be disqualified. Directors also carry legal duties — keeping records, filing on time, acting in the company’s best interests — so do not appoint someone just as a favour.
3. Which type of shares? Ordinary shares suit most new companies: one class, one vote per share. Different share classes (alphabet shares) add flexibility — one partner takes dividends while the other takes a salary — but also complexity, so keep it simple unless you have a clear reason not to.
4. What is the registered office address? Every company needs a real UK address on the public record — home or a paid service address. A home address is free, but anyone can look it up, so many women founders in particular prefer a service address for privacy. Decide together: this is where official letters from Companies House and HMRC will go.
5. What is the company name, and what does it do? The name must be unique and must not contain a sensitive word without permission. You also need at least one SIC code, a five-digit code describing what the company does — list up to four.
How to register a limited company with a partner: 7 steps
- Step 1: Both partners verify their identity. Since November 2025, every new director and every PSC must verify their identity with Companies House and get a personal code. It is free through GOV.UK One Login, and you only do it once. Each director needs their own code before you can register.
- Step 2: Agree the share split in writing. Most small companies issue 100 shares of £1 each, so a 60/40 split means 60 shares to one partner and 40 to the other.
- Step 3: Choose your articles of association. These are the company’s internal rules. Most founders use Companies House’s free, ready-made model articles. If you want special rules — for example, that big decisions need both partners to agree — you will need your own written articles; an accountant or solicitor is worth paying for.
- Step 4: Write a shareholders’ agreement. Separate from the articles and not filed with Companies House, this private agreement covers what happens if one partner wants to leave, sell their shares, or stop working in the business.
- Step 5: File the application online. You can register your company on GOV.UK in about 15 minutes: enter the company name, registered office, directors, shareholders, share details and PSC information, then pay £100.
- Step 6: Get your certificate and company number. Companies House emails the certificate of incorporation, confirming the company exists. HMRC then sends a 10-digit Unique Taxpayer Reference (UTR). You will need a separate Government Gateway user ID for the company — not your personal one.
- Step 7: Open a business bank account and tell HMRC. Open a company bank account, and register for Corporation Tax within three months of starting to trade. Do both as soon as the certificate arrives.
| Way to register | Fee | How long it takes |
|---|---|---|
| Online at GOV.UK | £100 | Usually within 24 hours |
| By post (form IN01) | £124 | 8 to 10 working days |
| Same-day, through approved software | £156 | Same working day |
Worked £ example: Amina and Sophie start a bakery company
Amina and Sophie open a bakery together. Amina puts in £6,000 and works full time; Sophie puts in £4,000 and works three days a week. They agree a 60/40 split — 60 shares to Amina, 40 to Sophie — both directors, both PSCs.
First-year statutory costs are small: £100 to register online, free identity verification, a £50 confirmation statement — £150 of compulsory Companies House costs for the whole first year.
Now imagine the bakery makes £60,000 profit in its first year. The 19% small-profits rate only covers profits up to £50,000; above that, marginal relief tapers the bill toward the 25% main rate. On £60,000 the tax is £12,150 (£15,000 at 25%, less £2,850 marginal relief), leaving £47,850 the company can pay out as dividends. Split 60/40, Amina receives £28,710 and Sophie £19,140, before any personal tax on the dividends. Each also has a £500 dividend allowance, and dividend tax starts at 10.75%. The split is automatic once the shares are set: dividends follow the shares, not who worked more hours.
The 50/50 deadlock trap — and the agreement that fixes it
Equal shares feel like the fairest choice, and for many couples and friends they are. But a 50/50 company with no tie-break rule has a built-in flaw: if the two of you disagree, nobody can outvote anybody and the company freezes. Neither partner can force a decision, sack the other, or sell the business — the only escape is negotiation, mediation or a court order to wind the company up. A shareholders’ agreement fixes this before it happens. It should cover how deadlocked decisions get settled (a casting vote, mediation, or an agreed third party); what happens if one partner wants to leave (can they sell, to whom, at what price); whether the remaining partner gets first refusal; and what happens if a partner dies or becomes seriously ill. Writing it while you still like each other takes an afternoon; after a row it takes months — and a solicitor’s bill.
4 mistakes business partners make
1. Skipping the written agreement. “We trust each other” is not a plan — it does not settle who owns the customer list when one partner leaves. Put it in writing while the relationship is good.
2. Choosing 50/50 with no tie-break. Equal shares are fine — equal shares with no deadlock clause are not. If you go 50/50, agree in advance how disagreements get settled.
3. Forgetting the PSC register. Anyone holding more than 25% of the shares or voting rights is a Person with Significant Control. The company must keep a PSC register and tell Companies House within 14 days when it changes. Both partners in a 50/50 or 60/40 company are PSCs — missing this is an easy fine to avoid.
4. One partner doing all the admin. If only one of you holds the Government Gateway login, the bank details and the filing deadlines, the other partner is flying blind — and the company is stuck if the organised one is ever away. Both directors should have access to everything.
What happens after you register
Registration is the beginning, not the end. In the first weeks, HMRC sends the company’s UTR and you add Corporation Tax to its business tax account. Every year after that, three dates matter: the confirmation statement, due once a year and costing £50; the company accounts, due at Companies House within nine months of the year-end; and the Corporation Tax return, due within 12 months, with the tax payable nine months and one day after the year-end. Keep the PSC register updated whenever shares change hands, and file a confirmation statement even in a quiet year. Treat these dates as shared jobs, not one person’s burden.
FAQ
Can my business partner and I both be directors of the same company?
Yes. A company needs at least one director and there is no maximum, so both partners can be directors. Both of you can also be shareholders. Each director must verify their identity with Companies House and get a personal code before registration.
Do we both need to verify our identity before registering?
Yes. Since November 2025, every new director and every Person with Significant Control must verify their identity. It is free through GOV.UK One Login, takes a few minutes, and you only need to do it once. Each director needs their own personal code.
Can one partner own more shares than the other?
Yes. Shares can be split any way you agree — 60/40, 70/30, 99/1. The split decides how dividends are shared and how much voting power each partner has. Anyone holding more than 25% of the shares or voting rights is a PSC and must be declared to Companies House.
What happens if my business partner wants to leave?
Your shareholders’ agreement should say: whether they can sell their shares, whether the remaining partner gets first refusal, and how the shares are valued. Without an agreement, leaving is messy — the remaining partner may be stuck with a co-owner who no longer works in the business, or the company may have to be wound up.
Conclusion
Registering a limited company with a business partner is straightforward: verify both identities, agree the share split, write a shareholders’ agreement, file online for £100. The registration takes a day; the decisions behind it — who owns what, who decides what, and what happens if one of you leaves — decide whether the partnership lasts. Make them together, write them down, and the company you register today will still be working for both of you in five years’ time.
