Forming a Private Company Limited by Shares in the United Kingdom involves a series of steps and adherence to legal requirements outlined by the Companies Act 2006. Below is a guide on how to form such a company in England and Wales:
Choose a Company Name
Choose a unique and suitable name for your company. Ensure that it is not already in use and complies with the naming regulations. The name should end with “Limited” or “Ltd.”
Registered Office Address
Decide on the registered office address for the company. This is the official address where legal documents will be served, and it must be in England or Wales.
A private company must have at least one director. Directors are responsible for the day-to-day running of the company. Obtain their consent and collect necessary details like full names, addresses, and dates of birth.
Appoint a Company Secretary (Optional)
While it’s no longer a legal requirement, you may choose to appoint a company secretary to assist with administrative tasks. If appointed, gather their details.
Issue Share Capital
Determine the share capital and the number of shares each shareholder will hold. The minimum issued share capital is usually £1. Shareholders are the owners of the company, and their liability is limited to the value of their shares.
Prepare Memorandum and Articles of Association
These are legal documents that outline the company’s constitution and internal rules. The Memorandum states the company’s objectives, while the Articles of Association detail how the company will be run. These documents must be signed by the initial shareholders.
Register the Company
Submit the required documents to Companies House. This includes the completed IN01 form, Memorandum, and Articles of Association. Pay the necessary registration fee. This can be done online or by postal application.
Receive Certificate of Incorporation
Once Companies House approves the application, you’ll receive a Certificate of Incorporation. This document confirms that your company legally exists.
Set Up Statutory Books
Maintain statutory books, including registers of directors, shareholders, and a record of resolutions. Keep these books at the registered office or another location notified to Companies House.
Open a Business Bank Account
Use the Certificate of Incorporation to open a business bank account in the company’s name.
Register for Corporation Tax
Register your company for Corporation Tax with HM Revenue & Customs (HMRC) within three months of starting your business.
By following these steps and complying with the legal requirements, you can successfully form a Private Company Limited by Shares in England and Wales. It’s recommended to seek professional advice to ensure compliance with the latest regulations and legal standards.
What is a Private Company Limited by Shares (Ltd)?
A Private Company Limited by Shares is a legal business structure in the UK where the liability of its members (shareholders) is limited to the value of their shares. It is commonly denoted by “Limited” or “Ltd” at the end of its name.
How many directors are required to form a Private Company Limited by Shares?
A private company must have at least one director. However, there is no maximum limit set by law. It’s common for small companies to have a single director, but larger companies may have multiple directors.
Is a Company Secretary necessary for a Private Company Limited by Shares?
While appointing a Company Secretary is no longer a legal requirement, companies can choose to have one. A Company Secretary helps with administrative tasks, ensuring compliance with statutory obligations.
What is the minimum share capital required to form a Private Company Limited by Shares?
The Companies Act 2006 abolished the concept of a minimum share capital requirement. A company can be formed with a share capital as low as £1. The share capital represents the value of shares issued to shareholders.
How do I choose a suitable name for my Private Company Limited by Shares?
Choose a unique and distinctive name that is not already in use. Ensure it complies with naming regulations and ends with “Limited” or “Ltd.” You can check the availability of a name through Companies House or an online company name checker.
What documents are required for the registration of a Private Company Limited by Shares?
The key documents include the completed IN01 form, Memorandum of Association, and Articles of Association. These documents outline company details, objectives, and internal rules. All initial shareholders must sign the Memorandum and Articles.
How do I register my Private Company Limited by Shares with Companies House?
Submit the required documents online or by post to Companies House, along with the applicable registration fee. The process typically involves verification of documents and information before the issuance of the Certificate of Incorporation.
Can I change the registered office address of my Private Company Limited by Shares?
Yes, the registered office address can be changed. Notify Companies House of the change and update the registered address within 14 days. The new address must be in England or Wales.
What responsibilities do directors have in a Private Company Limited by Shares?
Directors are responsible for managing the company’s affairs, making strategic decisions, and ensuring compliance with the law. They must act in the best interests of the company and its shareholders.
How often do I need to update statutory books for my Private Company Limited by Shares?
Statutory books, including registers of directors and shareholders, should be kept up-to-date at all times. Any changes, such as appointments or resignations, should be recorded promptly. These records are subject to inspection by regulatory authorities.