Are you considering setting up a limited company in the UK? Establishing a company in the UK can be complicated if you are not aware of the necessary steps to follow, or you are not aware of the right office or authority to seek advice.
In this article, we will go through the simple steps of setting up a company in the UK. By the end of this article, you will be able to set up your own company complete with all the necessary legal requirements. As with all other business, before you consider setting up a limited company in the United Kingdom, you need to gather the right information. It is only when you have the right information. This will make the process of setting up your company in UK easier.
Gathering the necessary information will also involve selecting a corporate structure and formalizing how the company will be managed. Below are the steps you should follow when you want to set up a limited company in the UK:
1. Establish which particular type of limited company that you want
When you register a limited company in the UK, you have to choose what is known as a private limited company. This can be an efficient way for you to manage your tax. For example, you can derive your revenue from dividends, paying less income tax, as the company director.
Another advantage is that if the business runs into a financial difficulty, your personal properties, like your car and house should not be put at risk. The word ‘limited liability’ is what this entails.
2. Registering a company in the UK.
Once you have established that you really need to register a limited company in the UK, the next stage is to kick off the actual process of registering your company. But before you do this, you must first verify that the name of the company is available before you go ahead to register it.
How can you do you choose a company name?
The next stage after you have your name, is to appoint the directors in your company. But first, you need to have a company secretary too. Acquaint yourself with the minimum requirements and the responsibility of the respective directors. You need to be very careful when selecting who will be the director and your company secretary. These are very key roles and should be chosen with utmost care.
4. Next is to establish who the shareholder or guarantors will be.
The next step, you will need a shareholder or/and a guarantor. This can be one of the directors. But even before your go ahead, you have to check and confirm whether you are required to set up a set amount. You should understand the details of how dividends from the shares should be taxed.
All the details you provide is made public when you register a limited company in the UK. Here Companies House will require information like:
Next, you need to choose people with significant control. For instance, this can be anyone who has a voting right. Alternatively, he should have more than 25% of the shares of the company.
6. Prepare the paperwork indicating how your company will be run
Here, you will have to prepare the Memorandum of Association and the Article of Association. You will need to research on how to create a memorandum and articles of association.
7. Establish the kind of records that you will be maintaining – at this stage, you will check the company and the accounting records that you will be required to keep.
8. Registering Your company – After all the paper works, it is time to have your company registered. You will have to register your official address and select an SIC code which detail what the company will be doing. Check details for this and more on the rules and regulations for company addresses. And then finally, you should register your company with companies’ house.
It is advisable to register for Corporation Tax at this stage, you will not be allowed to register with HM Revenue and Customs (HMRC) until when you will have registered the limited company with the Companies House. Don’t forget to register with HMRC because of the Corporation Tax.
In this article, we will go through the simple steps of setting up a company in the UK. By the end of this article, you will be able to set up your own company complete with all the necessary legal requirements. As with all other business, before you consider setting up a limited company in the United Kingdom, you need to gather the right information. It is only when you have the right information. This will make the process of setting up your company in UK easier.
Gathering the necessary information will also involve selecting a corporate structure and formalizing how the company will be managed. Below are the steps you should follow when you want to set up a limited company in the UK:
1. Establish which particular type of limited company that you want
When you register a limited company in the UK, you have to choose what is known as a private limited company. This can be an efficient way for you to manage your tax. For example, you can derive your revenue from dividends, paying less income tax, as the company director.
Another advantage is that if the business runs into a financial difficulty, your personal properties, like your car and house should not be put at risk. The word ‘limited liability’ is what this entails.
2. Registering a company in the UK.
Once you have established that you really need to register a limited company in the UK, the next stage is to kick off the actual process of registering your company. But before you do this, you must first verify that the name of the company is available before you go ahead to register it.
How can you do you choose a company name?
- Find out more details about your target market – here, you will go out and check the kind of names that your competitors are using. This will give you some ideas of how your names should be. You will always get some ideas and inspiration on how your name and even log and branding should be.
- The name you select should be relevant to your target market – The kind of name you choose for your company should be self-explanatory. People should be able to look at the name and relate it to your company. Align the name to the nature of good or services that your company will be providing to its clients.
- Use an easy to remember name – if possible, the name of your business should be easy to remember, and short. That way, your clients will easily remember an associate to your brand. It is really bad to have a complicated name that your client will take time and much effort to remember. Names should be short and memorable.
- Do not use complicated names – choose a name that your target market or demographic can easily pronounce without much effort. There is so much in a name, and if not done right, you may end up spending more money in rebranding in the future Therefore, it is important to choose a short and easy to spell name.
The next stage after you have your name, is to appoint the directors in your company. But first, you need to have a company secretary too. Acquaint yourself with the minimum requirements and the responsibility of the respective directors. You need to be very careful when selecting who will be the director and your company secretary. These are very key roles and should be chosen with utmost care.
4. Next is to establish who the shareholder or guarantors will be.
The next step, you will need a shareholder or/and a guarantor. This can be one of the directors. But even before your go ahead, you have to check and confirm whether you are required to set up a set amount. You should understand the details of how dividends from the shares should be taxed.
All the details you provide is made public when you register a limited company in the UK. Here Companies House will require information like:
- Where your office is registered - This will be the physical location where HMRC and Companies House are going to send mail. It needs to be in the United Kingdom so that the company directors can be easily contacted.
- Your appointed directors – before commencement of the process, a director must be appointed. House companies will collect their name, DOB and physical address.
- Establish your shareholders – The company should at least have a shareholder. The good thing is that, a director can also be a shareholder. The names, DOB and physical address details of the shareholders will be recorded at Companies House.
Next, you need to choose people with significant control. For instance, this can be anyone who has a voting right. Alternatively, he should have more than 25% of the shares of the company.
6. Prepare the paperwork indicating how your company will be run
Here, you will have to prepare the Memorandum of Association and the Article of Association. You will need to research on how to create a memorandum and articles of association.
7. Establish the kind of records that you will be maintaining – at this stage, you will check the company and the accounting records that you will be required to keep.
8. Registering Your company – After all the paper works, it is time to have your company registered. You will have to register your official address and select an SIC code which detail what the company will be doing. Check details for this and more on the rules and regulations for company addresses. And then finally, you should register your company with companies’ house.
It is advisable to register for Corporation Tax at this stage, you will not be allowed to register with HM Revenue and Customs (HMRC) until when you will have registered the limited company with the Companies House. Don’t forget to register with HMRC because of the Corporation Tax.
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