Limited company formation UK is the most preferred way by people who want to set up a company in the United Kingdom. Limited companies are divided into two categories: private limited companies and public limited companies. These types of limited liability companies, which are subject to different regulations, are preferred by people as each of them provides convenience in different areas.
There is a procedure to be followed for the establishment of a limited company in the UK. This process can be started by anyone online. At this point, you can get consultancy from companies that provide company formation services UK, or you can manage the whole process individually.
In this article, we will talk about limited company formation in the UK, the legal procedures and all the other information you need on the subject. For detailed information on the subject, you can read our article titled “Limited Company Formation UK” and contact us with any questions you may have.
Structure of a Limited Company
A limited company consists of shareholders and directors. People called shareholders are those who own shares of the company. Managers, on the other hand, are people who have the duty to run the company. As a rule, it is possible for shareholders to act as managers.
Apart from the shareholders, the limited company has a legal personality. In this respect, the company itself is primarily responsible for public and private debts. The profit obtained is shared among the shareholders who own the company shares in proportion to their shares.
The articles of association of the company are accepted as the establishment document of the limited company. The internal affairs of the company, the authorities of the managers, the functioning of the management and other matters related to the company’s management are determined in the company’s articles of association.
Conditions for Forming a Limited Company in the UK
The most preferred type of company among those who will establish a company in the UK is a limited company. People generally tend to form limited companies due to ease of establishment, taxation procedure, and many other reasons. As we explained above, there are two types of limited liability companies. These types are public limited companies and private limited companies.
Public Limited Company Establishment Conditions
Public limited companies have a long procedure and detailed terms compared to private limited companies. Due to this structure, it is not preferred much. As a public limited company, it is necessary to have a capital of £50,000 as a prerequisite. In addition, two partners, at least two shareholders, two managers, and a qualified company secretary are required.
Private Limited Company Formation UK Conditions
The conditions stipulated for the establishment of a public limited company are not sought in the limited company formation UK. This situation increases the preference rate of private limited companies. Only with the application of the limited liability company UK procedure can a private limited company be established without any conditions.
Ltd Company Formation UK Procedure
An easy procedure is envisaged for the limited company formation UK.First of all, the following points should be determined. After all the issues have been determined, the necessary documents for the establishment of the company should be collected. Afterwards, some forms related to the subject need to be filled out. After all these stages, an application should be made to Companies House. If the appropriate conditions are met and there are no missing documents, the company can be established within 24 hours.
The points to be determined before applying for limited company formation UK are as follows:
- It is necessary to determine a company name that has not been used by any company before and does not contain words that are prohibited.
- A company address to be registered with Companies House must be determined. The company’s address does not have to be the same as where it operates.
- The person who will be the director of the company should be determined.
- A manager who has not gone bankrupt before, has not been banned from any company and has completed the age of 16 must be determined.
- At least one shareholder must be identified.
After all these issues are determined, there are documents that need to be prepared to be submitted to Companies House. These documents are:
- The designated name of the limited company, the address and type of the company,
- Names, addresses and registered limited company address information of the directors,
- A document showing that the limited company complies with the terms and conditions of the Companies Law,
- Limited Company Articles of Association. This contract determines the name of the company, the shareholders, the distribution of shares, the purpose of the company, the limits of liability,
- Tax office registration procedures
The above documents are available on the Companies House Forms page. You can submit the necessary information by filling out the forms. Your limited company formation UK application will be examined by the competent authorities and your company will be established by Companies House within 24 hours if there is no obstacle to limited company formation UK.
FAQ About Limited Company Formation UK
1. Can I set up a limited company on my own in the UK?
Yes, limited company formation UK is possible as a sole partner. In this case, you must be both the guarantor and the administrator.
2. Do you pay less tax as a limited company?
Limited companies are advantageous compared to other partnership types with 19% tax rates. You can pay less tax by choosing a limited company formation UK as a company type.
3. How long does it take to set up a limited company in the UK?
After submitting all the documents to Companies House, limited company formation UK is possible within 24 hours. The time to collect documents may vary.