So you are ready for a new business venture and have decided a limited company is right for you. Here is a guide to getting one setup.
There are some basic initial guidelines to forming a company which you need to get started:-
- A company name – It goes without saying that your new company will need a name. It cannot however be the same as another company and even similar names will likely be rejected. The legal name of the company does not have to be its trading name so just choose something unique. The name will have to end with either ‘Limited’ or ‘Ltd.’
- An address for the company – This must be a physical address and needs to be in the same country that your company is registered in. PO boxes are not allowable and if you plan on using your home address and you live in a rented property you may need to consider using a registered office address provider as there may be restrictions in your tenancy agreement.
- At least one director – This is the person who is legally responsible for running the company on a day to day basis and will likely be paid a basic salary for their role although it is not a necessity.
- Details of the company’s share structure and at least one shareholder – The company has to have share capital (unless it’s a company limited by guarantee) and this decides the owners of the company. Shareholders can be remunerated for their investment in the company by the way of dividends. Don’t get carried away here and form a company with 1 million x £1 shares as you do need to pay your company to buy them.
- Checked what your SIC code is – You need to lodge a SIC code when forming your company. This code identifies what your company does as its trading activity. You can view the list of SIC codes here.
You will also need to make sure that the following are in place:
- Shareholders have agreed to create the company and the written rules, which are called ‘memorandum and articles of association.’ These can be custom created, but many companies use the default ones.
- The details of people with significant control over your company. This is anyone with more than 25% of your companies shares or voting rights.
Once you have all this information, you can register your company. It’s a relatively straight forward process if you have done your research and understood everything. If you are unsure you seek advice.
You can form your company via MBS Accountants using this link – Form your company now
Besides incorporating your company, there are other important aspects of running a business that you will need to consider before starting to trade. Check out this article which contains a checklist of what you need to have in place.