Choosing a limited company name for contractors (and how to change it later)

If you want to start contracting through a limited company, one of your first tasks will be to choose a good company name for your new enterprise.

You should take some time to research possible company names, as you may trade under it for many years.

A well-thought-out name can enhance your branding and make you more memorable to potential clients.

You will also want to present a professional image to clients or recruitment agencies.

Here are some essential company naming tips from the Contract Eye team, plus what to do if you change your mind later!

1) Future Proof

When setting up your limited company, it might be worth choosing a non-niche name, in case you want to conduct non-contracting business through it one day.

So, although ‘Rapid IT Solutions Limited’ may be a logical choice for a contractor company, it may not be such an ideal name if you decide to venture into property development or something unrelated in the future.

Many contractors are natural entrepreneurs, so this could be worth considering.

If you’re sure that you just want to channel your IT contracting work through your company, it’s less of a consideration.

You can always change your company name in the future, but you’ll save yourself quite a lot of hassle if you’re able to secure a future proof name at the start.

2) Naming Rules

Companies House has a number of company naming rules.

The name must not be offensive; it must also not be too similar to an existing company name. You must also avoid incorporating trademarked words into your company name, such as ‘Microsoft Web Design Ltd’.

Additionally, some words are considered ‘sensitive’ – such as ‘association’, ‘authority’, or ‘trust’. You may require special permission to use them.

In June 2016, Casio Services Ltd (CSL) was incorporated with Companies House, and the registrar accepted the name.

However, the famous Casio brand felt that the new entity had breached its intellectual property rights and took legal action to force CSL to change its name (which it subsequently did).

This example shows that it is worth spending some time researching a proposed name, and even if your name is accepted by Companies House initially, it could be challenged later.

All company names must end with ‘ltd’, ‘limited’, or ‘plc’. In Wales, you can also opt for ‘cyfyngedig’ or ‘cyf’. Contractor companies will almost always end in ‘limited’ or ‘ltd’.

You should read the Companies House guide Incorporation and Names for full details.

You can also perform a search on the IPO (Intellectual Property Office) website to ensure your name doesn’t conflict with any existing registered trademarks.

3) Domain names

When you’re researching potential company names, we alwas recommend trying to buy any related web domain names at the same time.

Not only will this protect your future web presence, but it always looks good if your email address (and website if you have one) match your company or trading name.

It will reinforce your brand and build trust with suppliers if there is consistency across your business name, domain name, and email addresses.

Always secure the .com and .co. UK domains, and depending on your finances, add as many others as you wish.

Our company’s domain names are hosted with GoDaddy. They’re reliable and reasonably good value – and we don’t get paid for saying that.

4) Investigation

Although there may be only anecdotal evidence to support it, given IR35’s close association with the contracting profession, having a company name that contains the words ‘contractor’ or ‘freelancer’ may catch the eye of HMRC tax inspectors.

Given that IR35 has been very hard to apply in practice, HMRC will typically seek easy targets for IR35 investigations.

A limited company named ‘Ipswich IT contracting services limited’, with a sole director drawing a small salary and large dividends, has ‘IR35 status enquiry’ written all over it.

Of course, you may well fall outside the IR35 rules anyway, but you don’t want to stand out from the crowd when you can easily avoid doing so.

Limited Company Formation

There are several ways to incorporate: directly via Companies House, through a formation agent (which typically provides more support than going direct), or by asking your accountant to do this for you.

If you are considering setting up a company but are not ready to proceed, you can always do so and keep it dormant. In this way, you safeguard the name while having only minimal administrative duties to fulfil each year if you’re not trading.

What if you want to change your company’s name?

Finally, if you decide that your initial company name wasn’t suitable, you can always change it by passing a company resolution and submitting Form NM01 to Companies House.

Your company can either pass a special resolution at a board meeting or, in most contractor limited companies, have all shareholders sign a written special resolution. There may also be another method specified in your Articles of Association.

You can view a sample written resolution here.

Once you have passed the special resolution, you should submit (or send) the signed document to Companies House with the correct processing fee and Form NM01 (Notice of change of name by resolution). It costs £20 to submit online, or £30 by post.

The new name becomes official once Companies House updates the public register, and you will receive a Certificate of Incorporation on Change of Name.

If you are changing the name using a different method, as detailed in your articles, you must file Form NM04 (but this is unlikely for most contractors). This costs £30 via post.

Your contractor accountant should be more than happy to facilitate the submission process on your behalf if required.

If you’re managing the change yourself, make sure you update all organisations you deal with for your business, including clients, HMRC and your bank once the name change has been accepted.