How to choose a business name

This article will show you how to choose the right name and what you'll have to do to ensure you're following the official rules, that's whether you're becoming a sole trader or limited company.

Giving the right impression

When choosing a company name, keep in mind that it will act as the first impression of your business. You want your name to convey the right feeling and message. That's whether you're trying to get across professionalism or something fun and different. It should also work across all mediums, including your website, marketing and signage.

Consider pronunciation and spelling

Just consider how many times you'll have to give your details out over the phone! Now think about your potential business name. Is it easy to pronounce? Will people understand what you're saying? And is it easy to spell? Try to pick something easy to speak and write.

Reflect what you do

If appropriate, consider a name that reflects what you do. It will get across very quickly what your business is about to potential customers. It might also help in terms of Search Engine Optimisation (SEO) where you can benefit from having a keyword or two in your name. But only do this if your business isn't likely to change and offer different services in future.

Think about the future

Always keep the future in mind when choosing a name for your business. Are you likely to expand? Will you be providing additional services in future? Choose a name that can easily see you through the next ten years. Don't pick something that's going to narrow your growth. You also have to choose something that won't date quickly, so avoid words and phrases that could go out of fashion.

Trading and corporate names

Did you know you can choose an official 'corporate name', but you can select a 'trading name' to represent that corporate name? It means you can select something quite corporate for your actual official name but create a trading name that's creative, or shorter and sweeter. You have to make sure you highlight your trading name/corporate name on all marketing materials, including your website.

Consider potential overseas hurdles

Are you going to be trading overseas? If so, check that your business name doesn't mean anything offensive in any other language. You don't want to limit yourself before you've even started, so double check meanings in other languages.

Check availability

So you've got a few ideas knocking around – the next important step is checking availability of your name ideas. Go on to the Companies House Web Checker to see if anyone else has already beaten you to it. And if you're home-free, go on something like 123Reg.co.uk to check that proper domain names are also up for grabs. When purchasing domain names, it's wise to buy something that not only has the 'co.uk' available but the '.com.' as well.

Names for sole traders

If you choose to become a sole trader, you're allowed to operate your business under your name, but you can have anything you like. However, there are some legal aspects to remember:

• Your business name must not be offensive;
• include any of the terms for a public limited company (PLC) or limited (LTD) or LLP or their Welsh equivalents
• or contain any sensitive words or expressions (i.e. there are certain words/phrases you're not allowed to use unless you have official permission, for example, 'British' and 'Authority').

Next, check that no one else is using your proposed business name. Bear in mind, that if a sole trader at the other end of the UK has the same name, there might not be an issue. But you could run into trouble if another local firm is using it. In which case, you should choose a different name. How do you check to see if someone's already got your name? Look through phone books, use Google or use the most excellent Companies House Web Checker.

Things to consider for limited companies

If you're forming a limited company, you must register your name and any other relevant details with Companies House. Bear in mind; it's essential your proposed name does not breach any rules on name endings, 'same as' rules or include a prescribed or sensitive work without prior permission. Here are the rules, so you don't get stuck. You must ensure that:

• Your name ends with 'limited' or Ltd
• Your name isn't offensive
• Your name isn't the same as anyone else in the index of company names (which you can check via the Companies House website)
• Your name doesn't include anything sensitive in terms of words or –unless you've had official permission to use them.

Double-check trademarks

You have to make sure your proposed business name isn't the same or very similar to a registered trademark. Use this handy Company Name and Trademark Checker.

Displaying your business name

Did you know that every business must display its name and relevant details to show customers who they're dealing with? If you're a limited company, you have to display your registered name on all hard copy and digital correspondence and documents. It includes letters, notices, emails, bills of exchange, invoices and even your website.

But what information must a limited company display? You must show:

• the place of registration and your registered business address
• the registered business number
• whether it's a limited company.

Please note, you'll also have to display your VAT registration number on your business website.

For sole traders, you must display your business name, your name and your business address in all areas, i.e. across all stationery, correspondence and your website.

To conclude

And that's how you choose a business name. You'll need to do this before anything else because if you're opening a business account, they'll want to see a letterhead with your business name and logo printed on it. Plus if you're informing the Inland Revenue of your new business, they'll need to know as well.