Incorporation is the process by which a brand-new or present business registers as a limited company. A company is a legal entity with a separate identity from those who control or run it. The large majority of partnerships are limited liability companies where the liability of the parts is limited by shares or by guarantee.
A business can not run as a limited company until it has been incorporated by Companies House. Building your business as a company means the directors are obligated to file various documents every year, such as annual accounts and a confirmation statement.
And they must likewise inform Companies House about any changes, such as the appointment or resignation of directors or a change to the company’s registered office.
It may be beneficial to seek professional guidance from Future Formations before deciding whether an incorporated company is the best idea for you to manage your business.
Who can incorporate a company?
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There are four types of company:
Private company limited by shares: This company holds a share capital, and the liability of each member is limited to the amount of their shares. A private company cannot give its shares for sale to the general public.
Private company limited by guarantee: The company does not hold a share capital, and its members are guarantors instead of shareholders. Those members’ liability is limited to the amount they agree to contribute to the company’s assets if it is wound up.
Private unlimited company: An unlimited company may or may not hold a share capital, but there is no limit to the member’s liability.
Public limited company: A public company has a share capital and limits the liability of each member to the number of unpaid shares. It may give its shares for sale to the general public and maybe quoted on the stock market. Public Limited Companies are the only structure that still required to have a secretary.
Why is HR important?
You can not reserve a proposed name.
We can not guarantee to process applications in strict order of the time or date we get them. And generally, electronic records are processed more quickly than paper documents.
You must tell us:
It’s no secret to human resource experts, administrators and supervisors that one of the most important decisions confronting the workplace is the skilled and acquisition, better known as recruiting.
Does a small company need HR?
• The proposed company name.
• Where the company is located, whether the registered office is in England, Wales, Scotland, or Northern Ireland
• The registered office address must be in the same country your business is registered in; i.e. a company registered in Scotland need to have a registered office address in Scotland.
• Whether the business will be private, public, or unlimited.
• Details of the company’s proposed business activities by reference to a standard.
• Industrial classification SIC codes (business activity).
• Choice of articles of association.
• Details of the proposed director and the secretary (if it has one).
• Details of people with significant control (PSC), or other legally required statements.
• Director’s service address and residential addresses.
• A statement of capital and initial shareholdings or a statement of guarantee.
• To use ‘limited’ or ‘cyfyngedig’ in its name
• If the proposed name contains a sensitive word and a section requiring confirmation that you have requested the views of a government department or other body.
• If you use your home address as your service address or the company’s registered office, it will be available to the public.
Memorandum of association
The memorandum of association confirms the subscriber’s intention to form a company and become members of that company. In the case of a company being limited by shares, the Memorandum and Article of Association will also provide evidence of the member’s agreement to take at least one share each in the company. Under the Companies Act 2006, the memorandum is a much shorter document because all the constitutional rules of the company are contained in the articles of association.
Consequently, the memorandum serves a more limited purpose and once the company has been incorporated, it can not be changed.
Information on capital and shareholdings is no longer part of the memorandum as it is contained in the application to register as a statement of capital and shareholdings or for a Company Limited by Guarantee, a statement of guarantee.
Articles of association
A company’s Articles of Association are its internal regulations, chosen by its members. Every company must have Articles of Association, which are legally binding on the company and all of its members. The articles help secure the company’s business runs easily and efficiently as possible and will set out how decisions are taken by the members and directors and various matters connected with the shares.
The articles cannot contain rules that are against the law. Provided the members observe this general principle, they have complete freedom to choose which rules are included in its articles. However, they may find it convenient to rely on model articles as a default position. If the members decide to draw up their own rules as bespoke articles, they may wish to obtain professional advice before proceeding.
Your company can adopt model articles in their entirety, model articles with amendments, or draft its own bespoke articles on incorporation.
Although the members can manage their own articles, they can also choose to use standard model articles set out in legislation. You are not required to adopt the provisions of model articles, but they are suitable for most standard companies, provide helpful guidance and in some cases provide a security net. They are available for private companies limited by shares, private companies limited by guarantee and public companies.
Once your company is incorporated, you must inform Companies House every time your company changes its articles. You and your company might commit an offence if you do not do so. You can change your articles by special resolution and deliver a copy to Companies House within 15 days of the date it is passed. You must also give a copy of the amended articles within 15 days of the date the amendment takes effect. It will help us if you file both at the same time.
If you would like more information, please contact our customer engagement team who would be delighted to assist you further.