U.K. Limited Companies
What is a limited company
A company is an association of two or more persons to form a separate legal entity for the purposes of carrying out their agreed objectives. A limited company is a company which limits the personal liability of it's officers. In the case of a private limited liability company the people who combine to form the company normally act as the directors and secretary and so are responsible for the managing of the company. They can also be shareholders each taking an agreed proportion of the shares. The company is treated as a separate legal entity in law. It can carry on legal business, enter into contracts, own property and assets and incur liabilities. Creditors of the limited company can look to the company for payment which can only be made out of the company's assets and not out of the directors or shareholders personal assets. This protection is not afforded to sole traders or partnerships who are individually liable for all the debts and liabilities of their business and if they cannot meet those liabilities, can be made bankrupt.
The Registrar of Companies will not allow two companies of the same name to be registered. Therefore, we provide a free company search from our computers which are linked directly to Companies House, and this information is available within minutes. If the name of your choice is available it can be incorporated in approximately seven working days, The cost is the same whether you choose a ready-made company from our list or prefer to wait for a company with your own choice of name. Once your name is registered as a limited company the name is protected by law. Certain words are sensitive and will not be allowed unless they meet certain criteria. Other words will not be allowed if they imply connections with government bodies or other established institutions. Our staff will be pleased to advise on the sensitivity or requirements for justifying the use of certain words in your company's title.
Which Company Registry Should I Use
In the U.K. There are three Company Registries. One is located in Cardiff, which is the main Registry for England and Wales, another in Edinburgh for Scotland and a third one in Belfast for Northern Ireland. Whilst a company incorporated at any one of these Registries is not restricted in where it carries on business, it is essential to remember that the company must have its registered office in the country of Incorporation. For example, if it is a Scottish company then the registered office must be in Scotland. There is only one register, however of companies for the U.K. and the Registrar will not allow a company to be incorporated, for example, in England and Wales if there is a company incorporated with the same name in Scotland or Northern Ireland.
Every company must by law have a registered office in the country of its incorporation where notices can be served. These need not be the primary place of business. This is the "legal" address of the company and is the only address listed at Companies House regardless of the size of the company. Any legal notices or tax notices must be served on the company at its registered office. A nameplate displaying the company's name must be displayed at the registered office. If you wish we would be pleased to act as your registered office if so instructed. A "PO Box" cannot be used as a registered office.
Directors and Secretary
The directors and secretary (or officers) manage the company. The shareholders (or members) own the company. In many private companies the directors and secretary are shareholders of the company. A private company can also have a sole director but he cannot also be the secretary. Therefore, at least two persons are required when forming a limited company. Where there is more than one director, one of the directors may act as a secretary. There is no restriction on the number of directorships an individual may hold, There is no restriction on the nationality or residency of directors or secretaries. Corporate directors and secretaries are allowed
Authorised Share Capital and Shareholders
Every company must have an authorised share capital. As previously mentioned, the shareholders are the owners of the company. The company can be incorporated with a share capital of your choice. However, our ready-made companies and standard incorporations are incorporated with a share capital of £2000 divided into 2000 ordinary £1 shares. This does not mean that you have to pay £2000 into the company. You can if you wish simply issue two £1 shares, there is no liability in respect of unissued shares.
Main Objects of the Company
The objects of the company and its rules of conduct are set out in the Memorandum and Articles of Association. The Memorandum and Articles of Association of the company are very important as they form the legal basis on which your company is built and govern the trade and conduct of the company. We have prepared these very carefully with the company objects wide in their scope to empower the company to carry on virtually any type of legal business, These standard general objects are used in all our companies. However if you require a specially drafted objects clause we would be pleased to do this for you.
What Do You Have to Show on Your Stationery
A limited company must show on all of its stationery its full company name, its registration number and the registered office address. It should state in which country it is incorporated. It is not necessary for directors names to appear. However, if you show one director's name then you must show them all ( except in the text of letter or as a signatory ).
Forming a Public Limited Company (PLC)
A public limited company (PLC) must have a minimum share capital of £50,000 which must be fully issued. At least 25% of the capital must be paid up in cash i.e. paid into the company's bank account when it has been opened or made available for use by the company. The company must have two directors, one of whom can act as the secretary. The company secretary must either be suitably qualified or be approved by a majority of the shareholders. A public company must file full audited accounts whereas a private company may file, under certain circumstances, modified accounts. We carry a stock of ready-made public companies available immediately. Upon purchase we will send you the company documents with a form 117 to sign in the presence of a Commissioner for Oaths or solicitor confirming that the share capital has been issued and at least 25% of it paid up. Upon receipt of this duly completed form we will obtain the certificate to commence business and borrow. This takes approximately seven working days. Alternatively, we can incorporate a PLC with your own choice of name. The cost is the same, the only difference is that it takes approximately seven days to incorporate.
The Advantages of a Limited Company
A limited company is completely separate in law from its directors and shareholders and enjoys limited liability. You may find it easier to raise finance through a limited company and there is a greater continuity of business as it is easier to bring other members of your family, friends or employees into the business or, indeed, to sell the company. The company enjoys protection of its name. A limited company only pays corporation tax on its profits, Directors and Employees of the company pay PA.Y.E.