SIC Code: Importance, List & Changes at Companies House

What Is a SIC Code?

SIC stands for Standard Industrial Classification code. It identifies a company’s primary business activity. Upon registering with Companies House, all UK-registered companies must assign at least one SIC code. Government agencies, investors, and analysts can better comprehend a company’s business operations by using the SIC code. Whether you manage a construction company or a software startup, an SIC code can effectively describe your primary business operations.

It is merely a distinct five-digit number that classifies companies according to their sector. A small bakery and an IT consultancy, for instance, may utilise different SIC codes. Filings, compliance, taxes, and even marketing all depend on knowing the correct SIC code. When submitting reports to Companies House, selecting the incorrect SIC code for a business may result in misunderstandings or even fines.

Why Are SIC Codes Important for UK Businesses?

SIC codes in the UK serve several essential functions. They are first used by government organizations to gather statistics unique to a given industry. Based on your SIC code, your company participates in surveys and economic reports. Second, before providing funding or investment, lenders and investors frequently look for a company’s SIC code. A business without the proper SIC code could come off as unprofessional.

Third, businesses need to appropriately report their SIC codes in Companies House documents. To remain compliant, you must update your company’s SIC code whenever your operations change. Proper SIC codes aid in the comprehension of your business model by regulatory bodies such as Companies House and HMRC. It may have an impact on eligibility for loans, grants, or taxes.

How to Find the Right SIC Code for Your Business?

Finding the correct SIC code for a company may be challenging. But Companies House offers a simple web tool for looking up SIC codes. Another option for searching is to use keyword matching. Examine the Companies House-published list of SIC codes first. It classifies hundreds of tasks, ranging from software development to farming. If you’re having trouble figuring out the code, consider your primary source of income. The standard industrial classification (SIC) code you choose should be determined by your main source of income.

For example, even if an online retailer constructs its warehouses, it would not need a construction SIC code. The primary trade must be reflected in the appropriate UK SIC codes. Choosing an ambiguous or out-of-date SIC code is a common mistake made by businesses. Always choose the one that is the most current and specific. For instance, rather than using outdated codes that are no longer commonly used, IT organisations typically choose SICC code 62090.

Can You Change Your SIC Code on Companies House?

You can change your SIC code at Companies House. Businesses frequently expand or enter new markets. As a result, you must update your SIC code to remain in conformity with the law. You typically change a company’s SIC code when you submit your annual confirmation statement.

You shouldn’t be alarmed if you discover that you have chosen the incorrect code during incorporation. By choosing the appropriate SIC codes that Companies House accepts, you can easily amend them on your subsequent confirmation statement. You can even submit an early confirmation statement outside of your regular filing window for urgent adjustments. An incorrect SIC code may result in regulatory problems or have an impact on financing applications, which is why it is crucial.

Remember that you can add more than one SIC code for your business if it engages in a variety of activities.

Example:

In the example, CloudBits Ltd updated their listing from web hosting to consultancy, choosing the appropriate SIC code 62090.

What Are the SIC Codes for Construction and IT Businesses?

The construction SIC code aids in the classification of companies engaged in specialized construction, civil engineering, and building operations. Common construction SIC codes in the UK are 41100 for building project development, 41201 for commercial building construction, and 41202 for residential building construction. These codes are crucial because they enable Companies House, HMRC, and other regulatory bodies to comprehend the particulars of your company’s operations. When establishing or maintaining your company’s records, selecting the appropriate construction SIC code is essential.

The SIC code for IT companies is determined by the kind of services they offer. For instance, SIC code 62090 pertains to various computer services and information technology operations, whereas SIC code 62020 includes information technology consulting services. Making use of the appropriate SIC code for IT business operations guarantees that you are appropriately categorized for industry analysis, funding opportunities, and tax purposes. Choosing the correct SIC code is particularly crucial when interacting with regulatory agencies and submitting applications for professional certifications.

Where Can You Access the Full SIC Code List?

The websites of Companies House and the Office for National Statistics (ONS) provide direct access to the whole list of SIC codes. For convenience, a lot of business experts now provide downloadable PDFs. The primary sectors make up the Standard Industrial Classification (SIC) code list. IT, professional services, retail, education, and construction, for instance, each have their divisions.

Make sure you are using the most recent version of the SIC code, currently the UK SIC 2007 classification, when performing a lookup. Steer clear of US-based or older lists since they may confuse your files. After looking over the list, if you’re still unsure, consult an accountant who is knowledgeable about UK SIC codes. Accurate filings save from later, expensive adjustments.

Conclusion

There is more to an SIC code than just a number. It formally represents your company’s operations to regulators, lenders, Companies House, and HMRC. Building confidence and adhering to legal requirements are made easier when you understand what a SIC code number is. Having the correct SIC code for your company helps with government reporting and enhances your reputation. The approach necessitates accuracy, whether you’re choosing a building SIC code or SIC code 62090 for IT services.

By searching the SIC code list and performing an SIC code lookup, you may quickly determine your right code. When submitting your confirmation statement to Companies House, you can modify your SIC code if your company takes a different turn. Precise SIC codes for company house filings safeguard your company and provide access to finance, tax breaks, and incentives.