What is a Public Limited Company / What is a PLC Company?
A Public Limited Company (also known as PLC or PLC Company) is a limited liability company whose shares may be freely sold and traded to the public with a minimum share capital of £50,000 and usually with the letters PLC after its name.
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Public Limited Company is a company that can freely, but not necessarily trade its shares to the public. Shares of the PLC are put on sale through a mechanism known as Stock Exchange, and then a member of the public can buy a share or stake of the ownership in this organization. When you buy shares in the PLC you are given limited liability, meaning you are not being held responsible if the business declares bankruptcy or gets sued. All the losses are covered by the company's assets.
The process of incorporating PLC is a little bit different than incorporation LTD. Except for the standard requirements like registering with Companies House, having Registered Office Address, etc., all public limited companies must have 'PLC' abbreviation after its name or 'Public Limited Company '. To form a PLC you must have at least 2 directors and one secretary, who needs to be fully qualified to perform her duties. If a director has adequate qualifications, he can perform secretary duties, but there must be a clause in the Article of Association mentioning it.
According to the Companies Act 2006, to set up PLC it must allot shares with a combined nominal value of at least £50,000.
Another condition of setting up a PLC is that it must hold Annual General meetings with all its shareholders, which not necessarily have much involvement in the operation of the business, but still have voting rights and the right to receive dividends.
One of the disadvantages of PLC is that they are more regulated both for taxes and Companies House, and HMRC tax deadlines are shorter for public companies. Your accounts need to be submitted within six months of each financial year-end.
What are the advantages of a PLC Public Limited Company?
- A PLC can have a huge magnitude of capital.
- It is legally authorised to trade on stock exchanges.
- There is no limit to the maximum number of shareholders in the public limited company.
- Shareholders of a PLC are entitled to transfer their shares freely without needing the consent of someone.>/li>
What structure does a PLC public limited company need to have?
- A minimum of two shareholders.
- A minimum of two directors.
What are the liabilities of a public limited company?
As a PLC deals with public money, it has to make heavy compliance checks with regards to income tax and regulated bodies.
Public limited companies will also have a separate legal identity.
A PLC can be either an unlisted or listed company on the stock exchanges.
There are advantages to becoming a public limited company, especially if you are interested in raising capital for your business.