Guide
How to build business credit for a limited company
Free · 2 mins
Start here · What do you need?
File your accounts and confirmation statement on time, as the law requires, and pay suppliers and lenders on time. Then check your file with each agency.
What a business credit file is
Credit reference agencies keep a file and a score on your company. Experian says its business credit report lets you see what lenders see when they make credit decisions about your business.
Each agency builds its own score. Creditsafe says its business credit score uses data such as your balance sheet, cash flow, payment history and company age, on a scale of 0 to 100. It also says each agency uses its own method, so scores can vary from one agency to the next.
Who keeps one
Business credit reference agencies in the UK include:
- Experian, which offers a report that shows your company's Experian business credit score.
- Equifax, whose commercial reports cover credit score analysis, financial data and director history.
- Dun and Bradstreet, which lets you view your business credit scores and payment history.
- Creditsafe, which says you can view your company credit report for free.
6 steps to build your company's credit
1. File your accounts on time at Companies House
GOV.UK says a private limited company must file its first accounts within 21 months of registering with Companies House, and after that within 9 months of the end of its financial year. A private company that files late pays £150 if up to 1 month late, rising to £1,500 if more than 6 months late, and the penalty is doubled if accounts are late 2 years in a row (GOV.UK, late filing penalties).
2. File your confirmation statement on time
Companies House guidance says you must file at least one confirmation statement every 12 months, and you can file it up to 14 days after the review period ends. The same guidance says the statement confirms the information Companies House holds about your company is up to date.
3. Keep company money in a company bank account (good practice)
This is good practice for clean records rather than a step that feeds a credit score directly. Run the company's income and spending through an account in the company's name. If you take money out of the company as a directors' loan, GOV.UK says you must keep records of it. You can compare fees on our business account fees table.
4. Pay suppliers and lenders on time
Creditsafe lists payment history as one of the things its score uses. Pay invoices by their due date and keep up with any loan, card or finance repayments. If you can't pay, talk to the supplier or lender before the due date.
5. Use trade credit and pay it on time
Trade credit means a supplier lets you pay for goods or services after you get them. Creditsafe says its Trade Payment Programme collects payment data from suppliers. Start with a supplier you already use, ask for an account and pay each invoice on time.
6. Keep your company details right and check your file
Keep your registered office and director details at Companies House correct. GOV.UK says you must report changes to directors within 14 days. Then check your file with the agencies above. Dun and Bradstreet, for example, lets you view your payment history to help make sure it is accurate.
Deal with any County Court Judgment fast. GOV.UK says banks and loan companies use the register to decide whether to give credit. The same page says a judgment paid in full within one month can be removed from the register, and one paid after that is marked as satisfied but stays on the register for 6 years.
How long it takes
A new company's file starts thin, because it does not have to file its first accounts until 21 months after it registered (GOV.UK, filing deadlines). Before you apply for finance, ask the lender how long you must have traded and how many sets of accounts it wants to see.
If you need finance before then, see business credit cards for new companies or how to get a business loan.
Frequently asked questions
Does a new limited company have a business credit score?
There is little for the agencies to go on at first. GOV.UK says a new company does not have to file its first accounts until 21 months after it registered with Companies House. Creditsafe says company age is one of the things its score uses.
Does my personal credit affect my company's credit?
Your company has its own file with each agency. Equifax says its commercial credit reports include director history, so your record as a director can show up in your company's report.
How do I check my company's credit file?
Go to the agencies directly. Experian offers a report that shows your Experian business credit score, with a 2 month free trial and then a monthly fee. Creditsafe says you can view your company credit report for free. Dun and Bradstreet lets you view your business credit scores and payment history. Equifax sells commercial credit reports.
How long does a CCJ stay on the register?
GOV.UK says a County Court Judgment stays on the Register of Judgments, Orders and Fines for 6 years. If you pay the full amount within one month, you can get it removed from the register. If you pay later, it is marked as satisfied but stays for the 6 years.
Can a sole trader use this guide?
No. This guide is for limited companies. FundBiz does not cover sole traders.
By Adam Parker. Last updated: .