A holding company in the UK, also known as a parent company, is primarily established to own shares in other companies. Unlike traditional operating companies, holding companies usually do not produce goods or services themselves. Instead, their primary function is to control or manage other businesses’ assets and operations.
What is a Holding Company?
A holding company is a business entity that owns a controlling interest in the stock or assets of other companies. These subsidiary companies operate independently but are overseen and managed by the holding company. The relationship allows the holding company to influence or direct the policies and management decisions of its subsidiaries.
Benefits of Registering a Holding Company in the UK
Risk Management: By segregating assets across different subsidiaries, a holding company can protect its assets from the risks associated with any one business failing. This structure can safeguard against potential liabilities.
Tax Efficiency: The UK offers several tax benefits for holding companies. These include exemptions from Capital Gains Tax on the disposal of subsidiary shares and exemption from withholding tax on dividends received from subsidiaries. Additionally, the UK has an extensive network of double taxation treaties.
As of 2025, businesses must also be aware of increased corporate transparency rules. These ensure the UK remains a safe and reputable jurisdiction for holding structures, while placing greater responsibility on companies to verify identities and declare lawful operations. The benefits of tax efficiency and regulatory clarity remain strong for properly structured groups.
Centralised Management: Holding companies provide a centralised management structure, making it easier to implement consistent policies and strategies across various subsidiaries. This can lead to more streamlined and efficient operations.
Investment Opportunities: Holding companies have the flexibility to invest in diverse industries and geographical regions. This diversification can enhance growth potential and reduce overall business risk.
Asset Protection: Placing valuable assets within a holding company can protect them from operational risks faced by individual subsidiaries. This separation can prevent business losses from affecting the holding company’s core assets.
How to Register a Holding Company in the UK
Choose a Company Structure: Decide whether to form a private limited company (Ltd) or a public limited company (PLC). Most holding companies in the UK are registered as private limited companies due to fewer regulatory requirements.
Register with Companies House:
As of 2025, registering a company with Companies House includes several new legal requirements under the Economic Crime and Corporate Transparency Act. The process now requires:
Submission of key documents such as the Memorandum and Articles of Association and Form IN01.
A registered email address for official correspondence (this will not be made public).
A statement of lawful purpose, declaring that the company is being formed for lawful reasons.
Identity verification for all company directors, subscribers, and People with Significant Control (PSCs), either directly with Companies House or through a registered Authorised Corporate Service Provider (ACSP) such as 1Office.
Set Up a Bank Account: Open a corporate bank account in the company’s name. This account will be used for all financial transactions related to the holding company. As you may know, 1Office partners with many fintech companies for bank account openings, with Revolut being one of the most popular. Read more about classical banking and fintech solutions here.
Companies must ensure that banking partners are aligned with enhanced Know Your Customer (KYC) obligations, which have become stricter under UK financial crime prevention rules in 2025.
Appoint Directors and Shareholders: Appoint at least one director and allocate shares to the shareholders. The directors will be responsible for managing the company, while shareholders will own the company. From March 2025, all directors must verify their identity before they can be officially appointed. Failure to do so may result in delays or rejection of the registration.
Obtain Necessary Licenses and Permits: Depending on the nature of the holding company’s investments and activities, you may need specific licenses or permits. Ensure compliance with all regulatory requirements.
Register for Taxes: Register the holding company with HM Revenue and Customs (HMRC) for corporation tax, VAT (if applicable), and PAYE (if you have employees).
Also note that from 2025, more businesses fall under Making Tax Digital (MTD) rules, and must maintain digital records for corporation tax and other filings.
Maintain Compliance: Once registered, the holding company must comply with ongoing filing and reporting requirements, including:
Annual confirmation statements (which now include a reconfirmation of lawful purpose and a valid registered email address).
Identity verification for any new directors or PSCs added during the year.
Filing of annual accounts, which from 2025 onward must be submitted via approved software only, as Companies House transitions away from paper and web-based filing.
Conclusion
Registering a holding company in the UK continues to offer strong advantages in terms of tax efficiency, group structuring, and risk management. However, due to regulatory changes introduced in 2025, forming and maintaining a UK company now involves stricter compliance obligations, including identity verification, lawful purpose declarations, and software-based filings.
These measures enhance corporate transparency and improve trust in the UK’s business environment. With 1Office’s expert guidance as a registered Authorised Corporate Service Provider (ACSP), you can confidently meet all new legal requirements while focusing on your strategic business goals.
Need Assistance?
For more information or to get started, contact 1Office today. As a registered Authorised Corporate Service Provider (ACSP), we are fully equipped to assist with the new identity verification and compliance process in 2025. Let us help you set up your UK holding company smoothly and efficiently. For further assistance, please contact uk@1office.co.
