If I buy a franchise, do I have to register my business with Companies House?
Buying a franchise is exciting, but it can also feel like a paperwork avalanche. One of the first questions we’re asked at Blue Rocket Accounting is whether a newly purchased franchise has to be registered with Companies House.
The short answer: only if you’re setting up a company or LLP
You do not automatically have to register with Companies House just because you’ve bought a franchise. Whether you must register depends on the legal structure you choose (and sometimes what your franchisor requires).
You’ll typically have three main options:
1) Sole trader
If you operate as a sole trader, you do not register with Companies House. You can start trading without registering a business, but you must register for Self Assessment with HMRC if your self-employed income is over £1,000 in a tax year.
2) Partnership
A traditional partnership isn’t registered with Companies House (unless you set up a limited partnership/LLP). However, you’ll still need the right HMRC registrations and a partnership tax return.
3) Limited company or LLP
If you set up a limited company, you must register (incorporate) with Companies House before you start trading as that company.
If you set up an LLP, you must also register it with Companies House.
Many franchisors prefer (or insist on) a limited company structure for consistency, branding, and liability reasons – so check your franchise agreement early.
A key “new rules” point: identity verification
Companies House is rolling out new identity verification requirements for directors and people with significant control (PSCs). The legal requirement begins from 18 November 2025, with changes phased in over time.
If you’re incorporating a company for your franchise, build this into your setup checklist so it doesn’t delay your registration or filings.
What else you’ll likely need to do when setting up a franchise location
Company registration is only one piece of the puzzle. Depending on your structure and turnover, you may also need to:
- Register with HMRC
- Limited company: register for Corporation Tax.
- Sole trader/partners: register for Self Assessment (see £1,000 trading allowance point above).
- Set up payroll (PAYE) if you’ll employ staff (even part-time).
- Consider VAT: you may need to register if you expect to exceed the VAT threshold (and franchises often scale quickly). Also, check how VAT applies to franchise fees and ongoing royalties.
- Prepare for Making Tax Digital for Income Tax if you’re a sole trader (or landlord) with qualifying income over £50,000, this becomes mandatory from 6 April 2026 and requires digital records and quarterly updates using compatible software.
- Get your bookkeeping ready from day one: separate business bank account, a clear chart of accounts for franchise reporting, and a system for tracking franchise fees, marketing levies, and any required management accounts.
- Understand your filing deadlines
- Limited companies must file statutory accounts and a confirmation statement with Companies House, alongside corporation tax filings with HMRC.
If you tell us the franchise brand and your expected turnover and staffing plans, we can recommend the most practical structure and build a “setup-to-first-year-end” checklist around it.
Get in touch with us today if you have any questions regarding setup requirements and our friendly Dartford based team will be able to help.
Continue reading business start-up advice
The Top 5 Tax Mistakes Start-Ups Make (and How to Avoid Them) | Blue Rocket
Is Your Business Idea Ready to Launch? A Quick Checklist | Blue Rocket
Understanding the Personal Tax Implications of Starting a Small Business | Blue Rocket
Disclaimer: This article should not replace legal advice. Blue Rocket Accounting assumes no responsibility or liability for any errors or omissions in the content of this site. Although every effort is made to ensure information is accurate and up to date, Blue Rocket Accounting takes no responsibility for legal action the reader chooses to take as a result of reading said literature. Please seek direct advice based on your individual circumstance.
