Using trading names for your company
Posted on 19th May 2022
As a business owner or company director, it is important that you know the difference between a company name and a trading name.
Your company name is the legal name that your incorporated business is known by and is registered with Companies House.
This name is the name that should be used on all official correspondence, invoices, purchase orders, cheques or postal order, license applications, notices, or any other official publications. The name must be unique, as it is not possible to create a limited company with the same or too similar a name to one that is already registered.
Click here to check if the company name you want is available.
Once you have chosen your unique company name and registered it, the name is protected by law and no other business can use it.
To start your limited company formation process get in touch today or, if you wish to manage the process yourself, visit this GOV.UK website.
Your trading name can be different to the one registered with Companies House. You can use as many trading names as you want under the umbrella of your registered company name.
You may want to run various sections of your business and to differentiate them to your clients you give them different names. For example, if you work as a baker and are registered as Browne Bread Brothers, but then you start an off shoot selling cakes, you can trade under another more suitable name, such as Browne Cakes.
The advantage of doing this is that you can run several different businesses, but you only need to submit one set of company accounts and confirmation statements, which could save you time and money on accountancy fees or administration costs.
Another reason for trading names is for branding, social media, website domain Search Engine Optimisation (SEO) purposes. You may need to create a name that will fit with what your customers are searching for when seeking your services.
Please note that trading names are not protected by law and another business can register this as their company name with Companies House and demand that you stop using it.
Also, you must ensure your trading name is not the same as or similar to any existing sole trader, business or trademarked name. You may be accused of ‘passing off’ your business as theirs, and therefore benefitting from their established reputation and client base. To avoid this possibility and incurring any legal costs if found to be infringing another company’s name, you should carry out a UK registered company and trademark search on your desired business name.
When choosing a trade name you cannot use certain sensitive words, these include limited, association, group, federation, or similar words. You must display your trade name as part of your business documentation where your company name is required (see above under Company name). For example, Browne Bread Brothers trading as Browne Cakes.
Registering a trademark is a way to retain your exclusive rights to use a name and can prevent other companies who are in the same field as you from using an identical or similar name. It also gives you the right to object to another company registering as a name that is similar to your trademark.
By doing this, you can prevent the use of an identical or misleading name being used that is similar to your trademarked trading name.
Click here to apply to register your trademark with GOV.UK. This will help to protect your company brand or product name.
If you’re starting your own limited company and are in the market for a new accountancy firm, contact us to see if we’re the perfect fit for you.
Nicola J Sorrell - Effective Accounting
Founder | Xero Champion | IR35 Expert
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