The UK is one of the best places in the world to form a limited company. You can open a company within 24 hours and be trading in the same amount of time. The number of legal documents you need to form a limited company is surprisingly small.
If you are thinking of opening a limited company, this guide is going to show you how to do it.
Most Tasks Can Be Done Online
The online portal with Companies House can allow you to change everything from your registered office address to the company directors. You are technically filing legal forms through this portal, but really you are just filling out a form on a webpage.
The same goes for the company formation process, but these are legal documents that should be printed out and kept for your records. They make up the pillars of your company.
Memorandum of Association
The Memorandum of Association details the initial shareholders. In layman terms, it states the intention of each person named to take up shares in the company. It also details the company’s official name. Despite the legal talk, the Memorandum of Association is only the base line for your company.
You can change the shareholders at any time, even after the company has been formed. In order to make things easier, some founders will only have themselves on this form, and then they will add people when the company is up and running. Adding new shareholders is easy with the Companies House online portal.
Articles of Association
It’s a legal duty to have Articles of Association. The articles are a rulebook that binds all members of the board. By law, certain clauses of the Companies Act 2009 have to be included. They detail what the directors can do, what happens when more shares are given away, and how directors can be removed from the board.
For most business owners, the articles in their legal form will never come into play, particularly when it comes to directors who don’t have anyone else on the board with them.
Some companies will draft the articles from scratch. This is not recommended because it requires a solicitor to make sure that everything that has to be included is included. Companies House provides a standard model that you can attach to your company during its formation with a click of the button.
The standard articles will fulfil the needs of 99% of companies, and should therefore be used. Companies House offers different articles for different companies, such as public companies and those that are limited by shares.
If you absolutely have to add a certain clause, you can add it to the model articles. The form detailed in the next section must be combined with any amendments you wish to make to your articles. For the majority of companies, the standard form is best. You can always change the articles at a later date and submit them back to Companies House.
Form IN01 is the form where you can make amendments to the articles. Any changes you wish to make can be added here. But Form IN01 still has to be submitted, even though you may be using the standard articles.
It also serves the purpose of noting the names and addresses of all directors, along with the company’s registered office. There’s detailed information regarding share capital and how many shares have been allotted to each director. Residential addresses of the directors on this form are not made for public viewing, unlike the registered company address.
There are restrictions on what you can name your company. In some cases, you may be able to bend these restrictions, but if you do you need to provide an additional statement. This will detail the reasons for why you have decided to include the proposed name.
You may also include official consent. For example, if you are using the name of a government department you would need their consent. If you are using an agent to form your company, this will be done automatically.
You can use our online company formation service and we take care of the paper and filing, our process has been simplified for you and it makes forming a company a piece of cake!