guide to starting a limited company
TRANSCRIPT
8/2/2019 Guide to Starting a Limited Company
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Brookson
Guide to setting up a limited
com an
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Contents
Section 1: Why go limited?
Section 2: Choose a name for your company
Section 3: Understand director responsibilitiesSection 4: Prepare the paperwork
form IN01
memorandum of association
articles of association
send application to Companies House
Section 5: Notify HMRC
Section 6: Set up your business bank account
Section 7: Start trading
Section 8: How Brookson can help
In this guide we take you step-by-step through the process of registering your business
limited company.
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Why go limited?
The process for setting up a limited company is illustrated below:
Setting up a limited company
This guide provides you with details regarding the process of setting up a limitedcompany.
To understand the pros and cons of working through a limited company compared
to other ways of working, please read our Choices Guide
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Choose a name for your company
If you haven’t yet chosen a name for your limited company, you need to choosea name that does not:
duplicate an existing company name, unless it is part of the same group
suggest a link with Government bodies
suggest that your company is something that it is not, for example,
‘international’
use, without permission, any of the words or phrases on the Companies House
list of prescribed words.
offend people
There are some ideas below to take into consideration when making this decision:
Should the business name include your own name?
E.g. John Smith Limited
Will it indicate what you do?
E.g. Gas Engineering Services Limited
Would you prefer a more professional approach or should the name reflect
your personality?
E.g. TPC Services LimitedDo you want a more old fashioned name to indicate stability or longevity?
E.g. Williams and Sons Limited
If you are targeting a local area, maybe use the Town or City?
E.g. Manchester IT Solutions
You can check the availability of company names by visiting www.jordans.co.uk .
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Understand director responsibilities
If you are opening your own limited company you are usually a director and
shareholder of the company. The different roles within a limited company are outlined
below.
Director: Private companies must have at least one director. The director is
responsible for:
running the business day-to-day
managing the company bank account
preparing accounts and annual returns
reporting changes to Companies House.
You cannot be a company director if you:
have been disqualified by a court
are an undischarged bankrupt
are under 16.
Company secretary: If you are opening a private limited company y ou don’t have
to appoint a company secretary by law, however you may want to appoint one to
help you meet your director’s responsibilities. This role is essentially an administrativeone which can assist you in running your company.
The director and company secretary, if appointed, are responsible for ensuring
that the limited company meets its obligations and is run in accordance with The
Companies Act 2006. Director responsibilities should not be taken lightly as the
director must ensure the limited company complies with company law, accounts
are produced properly with full disclosure, makes all statutory returns, is adequately
insured and meets health and safety obligations.
Decide who will subscribe to shares
There are different types of limited company, but most small and medium-sized
businesses that opt for limited company status become private companies limited by
shares.
Shareholders subscribe to these shares and depending on the type of share they can
receive dividends and vote to make decisions about the company.
To begin with, you may be the only shareholder; however you have the option to
include other shareholders.
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Prepare the paperwork
If you are using a company formations agent they will take the necessary details
and prepare all of these documents for you as part of the service.
IN01 is your application form for registering your company at Companies House.
It asks for:
contact details for the subscribers of the company
address of the registered office
statement of capital and initial shareholdings
The Memorandum of Association is a document that contains the company name, registered office, names of its members (director, shareholders) and the
number of shares held and by whom.
Once your company has been incorporated & registered as a limited company
– you cannot amend the Memorandum of Association.
Articles of Association are the internal rules by which the company will be
managed. Every company must have articles by law and all the members of the
company must observe these rules. Articles include details about:
directors - their powers and responsibilities
shares, dividends and distribution
decisions will be made about the company
other administration issues
directors' powers
Send documents to Companies House: You can register your company
electronically or on paper documents, whichever you find easier.
The following documents must be sent:
IN01
Memorandum of Association
Articles of Association
Once these have been sent Companies House will provide you with a Certificate
of Incorporation. The Certificate of Incorporation provides the name of the
company, unique registration number and place of registration.
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5Notify HMRC
Once you have received your Certificate of Incorporation you must contact yourlocal HMRC office to tell them about your company formation.
Set up your business bank account
You must open a business bank account. Not only to keep personal money separatebut also to satisfy Government officials and ensure accountability and transparency
in all of your business dealings. It is important to understand that you should avoid
using the business bank account as a personal account.
You could also open a business savings account to set aside your Corporation Tax
until due. If you do this, you can earn better interest in the nine months between filing
your annual accounts and paying your tax.
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Start Trading
When you have your Certificate of Incorporation and bank account, you are ready
to start trading as a limited company.
You need to show your company name and registration number, registered office
address and place of registration on any letters or emails. You will also need to
display the company name in full including Ltd/Limited or the Welsh equivalent on:
invoices
estimates
receipts
cheques
faxes
order forms
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How Brookson can help
We know you’re keen to get on with running your business. But the paperwork ofsetting up your limited company can take time away from your core business
activity, and on the forms there may be questions you’re not sure about.
At Brookson we help people set up limited companies every day. We can help you
save time, and help you:
work out if a limited company is appropriate for your business
establish a shareholding structure suitable to your business requirements
understand your responsibilities as a company director
appoint officers with our Company Secretarial Service
find a name for your business that Companies House will accept
prepare all the paperwork – IN01, Memorandum of Association and Articles of
Association – you need to send to Companies House
make sure all your documents comply with current legislation
set up a business bank account
And it doesn’t stop there, as an accountant, Brookson can assist you with all aspects
of running your limited company, from the basics of preparing all your necessary
returns to providing advice on registering for VAT and tax advice to suit your personal
circumstances.
We also provide a number of specialist services providing legal, bespoke tax,
overseas and company secretarial advice. By using our Company Secretarial
Service, we will be able to reduce the hassle of filing responsibilities and statutory
requirements.
Call us now on 0845 058 1400 and see how we can help you open your
own limited company.
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