Options on how to set up a limited company

Start limited companySetting up a private limited company is perhaps simpler than you may think. You can incorporate yourself, or use a professional to do this for you. Here we look at what you need to form a

company, and how the process works.

What information do I need to form a new company?

Before you start the incorporation process, you will need to have some specific information to hand.

Your proposed limited company name

Understandably, there are various restrictions to names you can choose, to ensure a new name is not too similar to an existing name, breaches trademarks or claims to be something it is not.

Your company’s official registered address

This must be a physical address where you can receive official communications. You may decide to use your accountant’s address, or even your residential address.

Your company’s SIC code

This stands for Standard industrial classification of economic activities. You need to decide which SIC code(s) relate to your new company.

Share capital

You must provide details of the company’s share capital (how shares will be divided up). Who are the shareholders (including names and addresses), how many shares will they each hold, and what class of shares will you create?

Many small limited companies simply decide to have 100 ‘ordinary’ £1 shares. You can always create new classes of share capital at a later stage.

Details of the company’s officials

To set up a company, you will need to have at least one director. You may decide to appoint a company secretary, however this is an optional appointment. You will need to provide each official’s full name, date of birth, nationality, occupation, and full address.

Although you need to provide each person’s residential address, you can also provide a ‘service address’ for each official which will appear on the public record and can afford extra privacy if required.

People with significant control (PSC)

You must provide details of any people who will have ‘significant control’ within your company, for example a person has 25% or more of the company’s shares, or voting rights.

Articles of Association

The Articles are the ‘rule book’ which govern how your company will be run. During the incorporation process, you can elect to use the Companies House ‘model’ articles, which are likely to suffice for most new companies.

Memorandum of Association

The Memorandum is signed by all shareholders and states that every shareholder has agreed to forming the new company. In practice, this document is automatically created during the formations process.

How do I know when my new company is successfully formed?

Once your registration is complete, you will receive a certificate of incorporation. This will prove that your company legally exists, and will also have important information on it such as your company number and on what date it was formed.

What shall I do next?

Once registered, you will receive a letter from HMRC asking you to register your newly formed company to pay Corporation Tax once it has started trading.

You may also need to register for VAT depending on your turnover, or if you’d like to register regardless.

Once you are trading, if you want to pay yourself a salary, or hire any staff, you will need to register with HMRC as an ’employer’, and set up a payroll to pay your employees, and work out any deductions owed.

You will need to keep Companies House updated should any key details change for your registered limited company (or its officials), including names, addresses, what the business does, or who the directors/secretaries/shareholders are.

You (or your accountant) can submit all of these changes online.0

0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply

Your email address will not be published. Required fields are marked *