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Company Formation - Before you form a company
Forming a limited company for the first time:
Unless you form companies regularly, you will be filled with questions. This page is aimed at giving you some starter information about what is required filing a UK limited company for the first time.
What information do I need?
Information Needed
General Company Formation Requirements:
- You must choose a unique Company name that isnt already on the register. Our system checks your proposed name with Companies House automatically (*see below for Oct 09 Changes)
- A UK based address is required for Companies House to send post to (if you are not a UK Resident you can use a registered office forwarding service). You cannot use a PO Box address for the registered office address, but you can trade from a PO Box address afterwards.
- You need the name, home address, date of birth and occupation for each involved person. Since October 09 its possible to also provide a service address as well so that your home address does not appear on public record. Companies House need a digital signature based on 3 (three) pieces of personal information. This defaults to the town of birth, the eye colour and the mothers maiden name of each person in the company (first 3 letters only so as not to be a security breach for yourself) but if you don't have this information for all officers, its also possible to supply home telephone, national insurance number, passport number or fathers firstname as the digital signature items. These 3 facts form a "digital signature" for Companies House to store instead of a paper signature.
* IMPORTANT: Companies Act 2006 from Oct 2009
A major change from October 2009 is the way company names are handled. Whilst previously Companies House ignored words like AND, OF, COMPANY, THE etc that didnt add much extra weight to the company name, under the new Act, many other words are ignored. Companies House now run a "same as" test to determine if the company name is too similar (rather than exactly the same) as another name. Prior to Oct 09 you could add "SERVICES" or "UK" or "SCOTLAND" onto the end of the name to make it unique.This is no longer the case. Words like ".com" or ".co.uk" or "services" etc will be removed when checking for name validity. Companies House are now also ignoring plurals of words. If Companies House deem the name to be too close, they will initially reject the submission and request that you get a letter of non objection from the company (or companies) already on the register,confirming they are happy for you to register the name, or you need to change the proposed name.
You can use our name checking facility on the Home page of this site, and an automated name check will happen during the company formation process.
Resubmissions back to Companies House with new names (if required) are FREE OF CHARGE
Forming a limited company:
With all correct information, it takes about 10 minutes to enter the details via our automated online company formations system, another minute or so to make payment. As a first time user of our company formation services, we have to carry out some Anti Money Laundering checks and then we send your company request through to Companies House. A few (usually around 4) working hours later, you could have your limited company registered.What people do I need?
Directors are the people who run the business, usually on a day to day basis. They make decisions on behalf of the business, sign contracts on behalf of the company and generally "run" the company. A director doesn't have to be involved in owning any of the business, they can purely just be involved in running it.
S
hareholders own the company. The benefit of a limited liability company is that the people who own the company have a limit to which their financial liability is set (should the company fail), based on the issued shares that they own. i.e. 100 shares @ £1 each, mean that the shareholder has a liability to pay the company £100 at some point in time, but not immediately. If the company incurs debts and closes, then unless trading illegally or giving personal guarantees, shareholders are limited in liability to the value of their shares. If they have already paid, they have no more financial liability to the company.
C
ompany Secretary is not the person who makes the tea and does the typing. The company secretary is responsible for the administrative requirements of the company with Companies House. If a new director is appointed, for example, there is a legal requirement to notify Companies House within 14 days of the date of appointment. and it is the Company Secretary who is responsible for ensuring that this takes place. Since April 2008, the new "Companies Act 2006" has removed the legal need for a company secretary and this has meant that for the first time, its possible to form a company with a single person. The duties still need to be carried out but this can either be by the same person named as a the Director and Shareholder, or you can elect not to have a company secretary named at all.
A single person could carry out the positions of Director, Secretary and Shareholder, or they can be given to different people.
Registering a Limited by Shares company is for general commercial businesses - ones aiming to make a profit (hopefully) and earn their shareholders money (i.e. not for a club or association or a charity). Shareholders own the company. You only need to issue one share to one person in the company. If you want to put money into the company to start with to get the business moving you can either allocate it as shares (and banks may act more favourably because you are showing a financial commitment to your limited company) or as a loan to the company to be repaid when the company can afford it. Since October 2009 there is no longer a requirement to specify "authorised shares" - i.e. how many shares have been authorised for use - you just simply issue more shares as and when you want more shareholders. If you decided to issue 1000 shares (at £1 each) to a shareholder, the shareholder has a liability to pay the company £1000 at some point - whether its at the start of the company's life, or, should the worst happen and the company is liquidated, the liquidator will see that the shares have not been paid for and will come to the shareholders to pay their liability.
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