There’s no legal requirement for you to advertise any vacancy, either internally or externally. This applies both to newly created positions and to roles that have become vacant. The process doesn’t have to be competitive, and you don’t even need to conduct an interview.
If you already have the perfect candidate in mind for your new position, or even if you’ve created the position specifically for them, you’re perfectly free to go ahead and hire them right away.
Legally, there is a potential problem if someone (another employee, for example) believes they have been discriminated against. There is a general legal duty on employers not to discriminate against employees or potential employees. To protect against such claims, it’s best to draw up a set of fair criteria for the post, even if you do not advertise it.
Additionally, if your new position is filled by an individual on a visa to the UK, in many instances you will be required to advertise the position; so do a little research to make sure you’re not in breach of any of the guidelines.