I am in the middle of starting up my first proper business, which is an online clothes store. I want to do everything official. I have decided that I am going to be using a private limited company to run my business, but I have never set one up before or been involved in the running of one, they seem quite complex as there are so many laws and red tape to deal with these days.
What do I need to know when setting up a private limited company in the UK? Your advice is much appreciated.
The Answer from Solicitors Online
When setting up a limited company in the UK, there are several rules and requirements that you should be aware of.
The official registrar of limited companies in the UK is Companies House. If you would like to set up a new company you can do this by registering it directly with Companies House or you can use a registered agent to register your company.
When setting up a company, at least one person must be a shareholder in the company. There is no maximum number of shareholders that you can have in a company. Each shareholder must own at least one share in the company.
Important information that you will need at hand when setting up a company is as follows:
a) The proposed name of the company
b) The proposed registered address of the company
c) Your decision as to whether or not the liability of the shareholders is to be limited and if so by shares or by guarantee.
d) Your decision as to whether the company is to be a private limited company (Limited/Ltd) or a public company (plc)
The articles of association are the internal rules of a company. If you do not submit your own articles of association written by yourself, the model articles (default articles of association) will apply to your company.
You also have the option to state that the model articles are adopted by your company subject to alterations that you submit when setting up your company.
When setting up a company the following information regarding the company’s initial shareholdings and capital are required:
a) The number of proposed shares in the company
b) The total nominal value of those shares
c) For each class of shares
d) Prescribed particulars of rights attached to those shares
• The number of shares in that class
• The total nominal value of shares of that class
e) The amount to be paid and amount that is still unpaid for each share
f) The prescribed particulars to identify the shareholders
g) For each shareholder
h) The total number of shares
i) The nominal value of their shares
j) The amount to be paid and the amount that is still unpaid for each share
The details of the companies’ directors are also required. These include the residential address of directors, and details of the company secretary if the company is to have one.
When you successfully set up a company in the UK, Companies House will give you a certificate, which states that the company has been officially incorporated. This certificate is evidence that the company has been set up in accordance with the requirements of UK law.
If you need legal advice online on setting up a company, you can speak to our Solicitors online right now.