What is a SIC code and how do I change it?

Introduction

A SIC code (Standard Industrial Classification code) is a 5-digit number that describes an economic activity that your business carries out. At least one SIC code is required by Companies House when a company is registered. This guide explains when you need to provide SIC codes and how to change it if you make a mistake or if your business activities have changed.

[key takeaways]

• A SIC code is a 5-digit number that describes the goods your business produces, or the services it provides.
• You can change your SIC code in your confirmation statement either when it’s next due or by filing early.
• Your SIC code is used by insurers and lenders in their decision-making process, so it’s important to keep it up to date.
  [/key-takeaways]

What is a SIC code?

A Standard Industrial Classification (SIC) code is a 5-digit number that describes one type of economic activity that’s carried out by a company. For example, the goods your company makes or the services it provides.

When you register your company, you’ll be required to select a minimum of one and a maximum of four SIC codes that best describe your business activities. SIC codes are used to facilitate data collection and analysis.

By classifying UK businesses according to their economic activity, government agencies and non-government bodies can develop an understanding of the types of businesses operating in the UK. They can also see how particular sectors are faring and monitor any emerging trends or changes.

Who can view SIC codes?

SIC codes are publicly available and can be viewed by anyone on the Companies House register of companies. They're used by their parties such as banks as part of their due diligence process.

Where do I find my SIC code?

A condensed list of SIC codes is available on the Companies House website, with a corresponding description of the economic activity they relate to. You must only use a code from this list when you register your business or when you make regular filings such as the confirmation statement. Doing so will ensure your filings are accepted.

Who doesn't need a SIC code?

Sole traders, general partnerships, limited partnerships, and limited liability partnerships don’t need to provide a SIC code when they register with Companies House.

3 tips for choosing the right SIC code

1. Review the list of condensed codes to determine which is the most appropriate for your business. You might find there’s a very specific code that matches the service your business offers.
2. If there isn’t a code that describes the precise nature of your business, you’ll need to look at some of the more general codes and consider whether your business activity could fall into that category.

• For example, if your business offers yoga and Pilates classes, SIC code 96040 Physical well-being activities is probably the most appropriate code for your business.

3. Search within the condensed list of SIC codes for your specific business activity to see if there is a code that describes your business. If there isn’t an exact match, you’ll need to review the full list to decide which SIC code is the most appropriate.

When do I choose my SIC codes?

You choose SIC codes to describe your business activities when you register your company. If you set up your business online with Companies House, you’ll enter your SIC code when asked “What will the company be doing?” If you use the paper form IN01 to register your company with Companies House by post, you’ll enter your SIC code(s) and a description of each principal business activity in section A5 of the form.

Some companies choose to use either the Dormant Company SIC code 99999 or the Non-trading company SIC Code 74990 at formation (when they are legitimately dormant) and change this when they begin trading at a later date. However, you should only use these codes if your company is genuinely dormant or non-trading. Make sure you change them as soon as you start doing business.

Don’t worry if you get your SIC codes wrong, there isn’t a fine, and you can change them on your confirmation statement either when it’s next due or by filing it early.

Can I use more than one SIC code?

Yes, you can use up to four SIC codes. This might be necessary if you can’t find one SIC code that neatly summarises your full business offering.

For example, if your yoga and Pilates business also offers counselling services, you could use SIC code 96040 Physical well-being activities and SIC code 88990 – Other social work activities without accommodation n.e.c to describe your business.

How do I check my company’s SIC code?

You can find your company’s SIC code by looking up your company on the Companies House register. Your company’s SIC code is shown on the overview page.

Alternatively, if you registered your company with 1st Formations, you can use our Online Company Manager facility to find your company’s SIC code.

How do I change my company’s SIC code?

You can change your business SIC code on your confirmation statement (form CSO1). To file a confirmation statement:

1. File online using the Companies House WebFiling service
2. Use the 1st Formations Confirmation Statement Service for just £75.99 per year
3. Print out and fill in the paper CS01 form and post it to Companies House for £110. You’ll only need to complete the declaration and part 1.

You’ll also need to provide the statement date when you complete the confirmation statement. The statement date refers to the date the confirmation statement is accurate up to. It’s usually the date you file your confirmation statement.

Sometimes the statement date can be in the past. For example, if more than 12 months have passed since you filed your previous confirmation statement. In that case, the statement date will be one year after you filed your last confirmation statement.

File an early confirmation statement

If you realise any of your SIC codes are wrong, you should change them as soon as possible by filing an early confirmation statement.

You can change a SIC code more than once in a 12-month period. When you file a confirmation statement, a new 12-month review period for your company begins. A new confirmation statement must be filed within 14 days of the end of that 12-month period. You can file earlier than that, and a new 12-month review period will begin from that date.

How the confirmation statement fee works

If you do need to change your SIC code more than once in a 12-month period, you’ll only pay the confirmation statement fee once. This is because the payment period for the confirmation statement is different from the review period: it covers 12 months from the date you formed your company.

You only have to pay the confirmation statement fee (£50 online; £110 by post) once during the payment period, even if you file multiple confirmation statements.

What if I use the wrong SIC code?

There isn’t a fine for using the wrong SIC code. You should correct your mistake by filing a confirmation statement as soon as you realise your error.

If your company continues to use the wrong SIC code, it could misrepresent it to lenders, insurers or investors, who may decide not to work with your company as a result. Using the wrong SIC code could also affect industry profiling of your business and mean it’s not included in relevant surveys or statistical analysis. There’s also a slight risk that your company could be excluded from sector-specific schemes such as industry grants, if it doesn't use the correct SIC code.

What if my company is dormant?

If your company is dormant (i.e. has had no significant accounting transactions) or non-trading (not carrying on business activity but still paying bills or holding assets), you will still need to use a SIC code. These are: 99999 – Dormant Company and 74990 – Non-trading company. It’s quite common to use the dormant company SIC code when the company is formed and change it later when trading begins.