Setting-up a limited company is a straightforward task, but you need to spend a little time at the start to prepare — if you have decided to set-up and run a company in the UK, here is a list of things to consider.
1) Choose a company name:
Look at different names and decide on a name that identifies with the proposed business activity if possible
Check if the name you want is available for registration
2) Choose the people who will oversee the running of the Company:
The directors are legally responsible for (or have statutory obligations to) the limited company, including:
Ensuring the company’s aims and objectives are achieved wherever possible
Making sure annual accounts are properly prepared and filed
Ensuring that documents are delivered to Regulatory authorities timeously
A limited company must have at least one director who must be over the age of 16 and not be disqualified from being a director. A director does not have to live in the UK, but the company must have a UK registered office address.
Corporate directors are acceptable as long as there is a natural person (individual) in place as director.
It is not a requirement for limited companies to have a company secretary any more, although many still do appoint one as a company secretary can assist the Directors in meeting their statutory obligations. The company secretary can also be a director, or a Corporate secretary.
3) Decide who the shareholders are:
A shareholder is an individual or corporation that legally owns shares in a company ‘limited by shares’. A company limited by shares must have at least one shareholder. The shareholder will normally be entitled to vote on company matters. The extent of ownership and the power of the vote is usually determined by the percentage and rights of the shares issued to each shareholder.
Shareholders normally enjoy the benefit of a dividend based on the profits of the company.
4) Identify people with significant control over the company:
Anyone with more than 25% of shares or more than 25% of the voting rights in the company are considered to be a person with significant control (‘PSC’) and will need to be identified.
5) Prepare the Constitutional Documents:
When registering the Company, a legal statement signed or authenticated by the initial shareholders, the (Memorandum of Association) and the written rules about running the Company, the (Articles of Association) will be needed. These are generally standard format.
6) Choose the Registered office address for the Company:
A registered office address in the UK must be provided when setting-up your company. This is the address where official communication e.g. letters from Companies House, HM Revenue and Customs will be sent. A PO Box address is not acceptable.
7) Register your Company with Companies House
Registration can be done electronically or by post by using Form IN01, or through an incorporation agent.