27 May 2021
As a small business owner in the UK, you need to know what your SIC code is and how to use it.
Standard industrial classification (SIC) codes are a uniform structure for categorising businesses according to their industry or economic activity. Various government and non-governmental bodies use them to describe and record corporate activities to help spot industry trends and track the health of economic sectors.
Companies also use them for research such as segmenting markets, and analysing customer relationships.
As a small business, the first place you’re likely to encounter SIC codes is your application to set up a limited company.
The Office for National Statistics (ONS) uses SIC codes to classify businesses and other standard units by type of economic activity.
Companies House uses a condensed version of the ONS list to describe and record each company’s activities and spot and track sector trends.
The US federal government initiated the SIC system, in conjunction with the business community, in the 1930s.
The UK first introduced standard classifications in 1948. Since then, there have been at least eight versions as the taxonomies have been adapted to keep up with changes in industry. For example, the 1980 version was far more detailed in manufacturing, and the 2007 system was much stronger in the IT sector.
In 1997, the Americas replaced SIC codes with the North American Industry Classification System (NAICS), which is now the standard for Mexico, Canada and the US.
You must include your SIC code in your application to incorporate a limited company and in your Companies House filings.
To find your code/s, you must only use the Companies House condensed list, or it may reject your filing.
To help you find the right code, the list is divided into trade groups and searchable by code number or trade description.
For example, if you are an accountant, section M (professional, scientific and technical activities) is your area and 69201 (accounting and auditing activities) is the appropriate code.
If you repair cars, you will probably fall into section G (repair of motor vehicles and motorcycles). The code 45200 (maintenance and repair of motor vehicles) would be most applicable.
You can choose up to four SIC codes, as your services or products may vary. So, if you sell used cars as well as repair them, you could add code 45112 (sale of used cars and light motor vehicles) to 45200.
Even if your company is dormant (99999) or non-trading (74990) you still need to give a code.
If your business activities change, you can also alter your SIC code/s, when you file your next confirmation statement.