The relevance of SIC Code

SIC code stands for Standard Industrial Classification Code and is used to classify business activities of a company. Companies House and other government bodies use SIC codes to identify what companies does and to sort them into correct business category’s. Currently, there are more than 600 individual SIC codes. By gathering information on SIC codes, it is possible to track the number of companies operating in different industries, identify emerging trends, and monitor the strength of various parts of the UK economy.

A system of codes for company categorisation was first introduced in the USA in 1937. The UK SIC code system, originally introduced in 1948 and officially known as United Kingdom Standard Industrial Classification of Economic Activities, was then based on this. There have been quite a number of different lists of industry classifications in the UK, mainly to keep up to date with the changing structure of the UK economy, industry and employment. Since the introduction of original list, revisions were published in 1958, 1968, 1980, 1992, 1997, 2003, and 2007.

The most recent update has made UK SIC codes consistent with the United Nations’ ISIC standard and the European Union’s NACE system, although the most noticeable difference for most people is the fact that the 2007 SIC codes have five digits, whereas the 2003 industry codes had just four. Starting from 1 October 2011, all companies are required to use the latest 2007 industry code list.

In attempting to describe and classify the wide range of activities undertaken by the UK companies, the UK Government has introduced more than 100 different SIC code categories to choose from. Alongside other government bodies, the Office for National Statistics gathers and publishes data based on the SIC classifications which allow, for instance, to compare earnings figures between different industries and occupations. The SIC codes of all UK companies are publicly available and can be used for research purposes by any other third party.

The need to supply a SIC code during the company at formation is a new requirement that was introduced in the UK on 30th June 2016. Previously, when companies were set up, they did not have to state their SIC code(s). This information was provided on the first annual return (which has now been replaced by the confirmation statement) and when registering for VAT.

When you register a company at Companies House, you must provide at least one SIC code to describe what your business does, even if it is dormant (inactive/not trading). You can choose up to four SIC codes if required. SIC codes must also be confirmed or updated (whichever applies) each year on the Confirmation Statement. SIC codes, along with other key company details, will be displayed on public record at Companies House. If a company selects a wrong SIC Code, it can change its SIC Code by submitting a Confirmation Statement that confirms the new code. This can be done either immediately or when the next statement is due.

The SIC code for dormant companies is 99999. The SIC code for non-trading companies is 74990.

What is the SIC Code used for ?

SIC codes are used by governments, lenders, and private businesses. Governments might use the codes to track various industries. For example, the Government might use SIC codes to compare all manufacturing businesses in an economic study. More frequently governments use these codes for studies and statistics.


When applying for government contracts and loans, businesses might need a SIC code which the government uses to assess their eligibility. Some loans and projects might be limited to certain industries or business sizes within industries.


SIC codes are often used by the Securities and Exchange Commission (SEC). If your business were to ever become public, you would need to know your SIC code.


Lenders might ask for a SIC code when a business applies for a loan. The lender might use the code to determine if the business is in a high-risk industry.

If you sell products or services to other businesses, you might use SIC codes to identify potential customers. For example, you might want to target potential clients within a certain industry. You use other businesses’ SIC codes to determine if they are good fits to sell to.

You might consider using SIC codes in your market analysis. When analysing a market, you will compare your business to similar businesses. By using SIC codes, you can be sure you are actually comparing your business to businesses in the same industry.


Businesses use it to discover new customers to trade with and size their own marketplace.


SIC codes have some relevance to credit ratings which could cause issues if the company is being compared to a different trade sector. Having an inaccurate description on the VAT registration also means that you are heightening the risk of enquiry as HMRC's system may flag the trade activity as unusual for the listed one.

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