Company Formation in UK
Start a company and separate your personal and business finances.
A company is considered a separate legal entity from its owners. It provides a level of protection for the personal assets of the owners. In the event of financial difficulties or legal issues, the personal assets of shareholders or members are not at risk.
What is a Limited Company?
A Limited Company is a legal business structure that is separate from its owners (shareholders) and has its own legal identity. It is the most commonly used form of business in the United Kingdom.
There are different types of companies in the UK. Based on the business motives, business liability, structure of ownership and management, companies are classified as Private Limited Company (LTD) and Public Limited Company (PLC)
Limited Liability
The liability of the shareholders is limited to the value of their shares. This means that the personal assets of the shareholders are protected in the event of financial difficulties or legal issues faced by the company.
Separate Legal Entity
A Limited Company is a separate legal entity from its owners (shareholders). It can own property, enter contracts, and sue or be sued in its own name.
Perpetual Existence
A Limited Company has a perpetual existence, meaning it continues to exist even if shareholders change or pass away. It does not dissolve upon changes in ownership.
Shareholders and Directors
Limited Company is owned by shareholders who hold shares and is managed by directors who are appointed by the shareholders.
Start a Company to protect your Assets
If you are doing any business in UK, it is always advisable to do it as a Limited Company to protect your personal assets from business liabilities.
So, start a Limited Company today itself….!
How to register a company in UK?
Company registration in the UK is administered by Companies House. Registering a company in the UK involves several steps. You can register a company by submitting the required information online or by post to Companies House.
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1. Company Structure
Determine whether you want to form a private limited company (Ltd), a public limited company (PLC), a limited liability partnership (LLP), or another structure that suits your needs.
2. Company Name
Choose a unique name for your company. Your name should not be the same or too similar to another registered company’s name. Company name must usually end in either ‘Limited’ or ‘Ltd’.
3. Shareholders & Share Capital
Identify the shareholders and specify the number of shares and their value. Shareholders are owners of the company.
4. Directors of Company
There should be at least one director in a company. Directors are appointed by the shareholders to manage the day-to-day affairs of the company.
5. Registered Office Address
You need to provide a registered office address for official communications. This address must be where you register the company.
6. Memorandum and Articles of Association
Prepare these incorporation documents to define the company’s objectives, Â rules, and regulations and how it will be run. You can use standard templates or create your own.
7. Register with Companies House
Submit the details and required documents to Companies House and pay the required fee.
8. Certificate of Incorporation:
Once the Companies House processes your application and approves it, you’ll receive a Certificate of Incorporation. This certificate is the conclusive evidence of your company’s legal existence.
Frequently Asked Questions
1. What is company formation?
Company formation is the process of legally creating a new business entity, separate from its owners, with its own legal identity. This allows the business to enter into contracts, own property, and conduct business activities in its own name.
2. What types of companies can be formed in the UK?
The most common types of companies in the UK are Private Limited Companies (Ltd), Public Limited Companies (PLC), Limited Liability Partnerships (LLP), and guarantee companies. Each has its own legal structure and regulations.
3. What is the difference between a private limited company (Ltd) and a public limited company (PLC)?
A private limited company is owned by private individuals or other companies, and its shares cannot be publicly traded. A public limited company can issue shares to the public and is listed on a stock exchange.
4. What is the process for registering a company in the UK?
The process involves choosing a company name, deciding on the company structure, providing a registered office address, appointing directors and shareholders, and preparing and submitting the necessary documents to Companies House.
5. What is the minimum number of shareholders and directors to register a company in the UK
You need at least one shareholder to register a private limited company (LTD) in the UK. This can be an individual or a corporate entity. Also, you need at least one director. The director can also be the sole shareholder, but they cannot be under the age of 16.
In the case of a public limited company (PLC), you need a minimum of two directors and two shareholders. Additionally, there must be a company secretary.
However, you can have more than one director and multiple shareholders in your company.
6. Can the only shareholder be the director of a company?
Yes, the sole individual shareholder can be the director a company.
7. Do I need a physical office address to register a company?
You need to provide a registered office address for official communications. It must be in the same country (e.g., England and Wales, Scotland, or Northern Ireland) where you register the company. Information about this address will be publicly visible through the website of the companies house. You can choose to provide the address of your accountant or a virtual address as the case may be.
8. What is a registered office address?
A registered office address is the official address of a company. It is where the Companies House and other official communications will be sent. It must be in the same country where you register your company.
9. Can a foreigner register a company in the UK?
Yes, foreign individuals and companies can register a company in the UK. They can act as directors and shareholders, but there may be additional requirements for non-UK residents.
10. How do I check if my chosen company name is available?
You can use the Companies House name availability checker on their website to see if your chosen name is already in use.
11. Do I need a company secretary for a private limited company?
No, it is no longer a legal requirement for private limited companies to have a company secretary. However, a public limited company (PLC) must have a company secretary.
12. How much share capital do I need to start a company?
There is no longer a statutory minimum for share capital. You can choose any amount that suits your business needs.
13. What is the minimum share capital required to start a company?
There is no minimum requirements for share capital. You can choose any amount that suits your business needs.
14. What documents do I need to submit to register a company?
You will need to submit the Memorandum and Articles of Association, details of directors and shareholders, and a registered office address.
15. How long does it take to register a company in the UK?
The registration process can be completed online in a matter of hours, provided all the necessary information and documents are in order.
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