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About Company formation

What does company formation mean?

Company formation is the process of legally incorporating and registering a limited company with Companies House. This can be done in as little as 3 hours by completing and filing an online application form. Upon incorporation under the Companies Act 2006, a limited company becomes an individual legal entity that is completely distinct from its owners and responsible for its own finances and liabilities. A limited company can therefore enter into contracts in its own name, take ownership of its assets, and provide financial protection to its owners in the form of limited liability.

About Companies House

Companies House is the registrar of companies in the United Kingdom, and it operates in three jurisdictions: England and Wales, Scotland, and Northern Ireland. It is an executive government agency of the Department for Business, Innovation and Skills (BIS), and its primary functions are:

  • To incorporate and dissolve limited companies.
  • To examine and store all mandatory corporate information provided by limited companies that are registered in the United Kingdom.
  • To provide transparency and openness by making all corporate information available to the public on the official government register of UK companies.

What is limited liability?

Limited liability is one of the most significant benefits of company formation. It provides financial protection to company shareholders, company guarantors and LLP members. Because the law views limited companies as distinct legal entities, their owners are only responsible for business debts up to the amount of money they invest in the company through shares, or agree to pay in the form of a guarantee. Any liabilities beyond these sums are the responsibility of the limited company alone. Without such a safety net, company owners risk losing their personal assets and finances as a result of business debts and claims.

How to register a limited company

The incorporation process is surprisingly quick, straightforward and affordable. There are three ways in which a company can be registered: online or by post directly with Companies House, or online through a professional company formation agent like Quality Formations. The latter option is by far the most popular because of its quickness, simplicity, low cost, and efficacy. Additionally, expert advice and assistance is on-hand throughout the entire process.

To register a new company through an authorised agent, an online application form must be completed.

Registering a private company limited by shares or guarantee

The following information is required to register a private company limited by shares or guarantee:

  1. PROPOSED COMPANY NAME.

    Your chosen name must not be the ‘same as’ or ‘too like’ the name of an existing company on the register, unless your company will be part of the same group, or permission is granted by the other company. You can use our online name-check facility to compare your chosen name against the official Companies House register - simply click on the green ‘Start’ button on our homepage.
  2. REGISTERED OFFICE ADDRESS.

    This must be situated in the UK jurisdiction of incorporation - England and Wales, Scotland, or Northern Ireland. Your registered office will be your company’s official home address, where statutory mail will be delivered from Companies House and HMRC. However, there is no need to trade from this address.
  3. DIRECTORS’ DETAILS.

    You must appoint at least one director, but you may appoint as many as you like, provided they are at least 16 years old. Other companies and non-human entities may also be appointed as directors, as long as one other director of the company is an individual person. Shareholders and guarantors can be directors, too. The following details are required for each director:
    • Title
    • Full forename(s)
    • Surname
    • Former name(s)
    • Country/State of residence
    • Nationality
    • Date of birth
    • Residential address
    • Service address
    • Business occupation
  4. SUBSCRIBERS’ DETAILS (shareholders or guarantors)

    You must appoint at least one shareholder/guarantor, but you may have as many as you like. Other companies and non-human entitles may also be shareholders or guarantors. Directors can be shareholders or guarantors, too. The following details are required for each subscriber:
    • Forename(s)
    • Surname
    • Service address
    • Three personal details to create a secure online signature
  5. PERSON WITH SIGNIFICANT CONTROL (PSC) information

    You must appoint at least one shareholder/guarantor, but you may have as many as you like. Other companies and non-human entitles may also be shareholders or guarantors. Directors can be shareholders or guarantors, too. The following details are required for each subscriber:
    • Full Name
    • Date of Birth
    • Residential Address
    • Service address
    • Nationality
    • Nature of Control (e.g. Holds more than 50% to 75% of shares.)
    • Three personal details to create a secure online signature
  6. MEMORANDUM AND ARTICLES OF ASSOCIATION.

    These are two separate documents that state the name of each member, their agreement to form a limited company and take shares or provide a guarantee, and the rules and regulations for running the business. Most companies adopt model articles from Companies House, but it is possible to adapt this standard version or create entirely bespoke articles.
  7. STATEMENT OF CAPITAL AND INITIAL SHAREHOLDINGS (limited by shares companies only).

    This section requires information about the shares you wish to issue - quantity, type, value, attached rights, and whether or not they are paid or unpaid by each shareholder.
  8. STATEMENT OF GUARANTEE (limited by guarantee companies only)

    This section outlines the amount of each guarantor’s financial guarantee.

Registering a limited liability partnership (LLP)

The following information is required to incorporate an LLP:

  1. PROPOSED LLP NAME.

    Your chosen name must not be the ‘same as’ or ‘too like’ the name of an existing company or LLP on the register - you can use the online name-check facility on our homepage to compare your chosen name against the official Companies House register.
  2. REGISTERED OFFICE ADDRESS.

    This must be situated in the UK jurisdiction of incorporation - England and Wales, Scotland, or Northern Ireland. This will be your LLP’s official home address, where statutory mail will be delivered from Companies House and HMRC, but there is no need to trade from this address.
  3. LLP MEMBERS’ DETAILS

    You must have two or more members (partners) to set up a LLP, but you may appoint as many as you like, provided they are at least 16 years old. Other companies, LLPs and non-human entities may also be appointed as LLP members, as long as one other member is an individual person. The following details are required for each member:
    • Title
    • Full forename(s)
    • Surname
    • Country/State of residence
    • Date of birth
    • Residential address
    • Service address
    • Three personal details to create a secure online signature
  4. PERSON WITH SIGNIFICANT CONTROL (PSC) information

    • Full Name
    • Date of Birth
    • Residential Address
    • Service Address
    • Nationality
    • Nature of Control (e.g. Holds more than 50% to 75% of shares.)
    • Three personal details to create a secure online signature

Uploading amended articles and additional documentation

The ability to upload and file documents electronically is one of the many advantages of registering and managing your company online through Filing Software.

If you decide to adopt model articles in their entirety, you will simply be required to check the appropriate box on the online application to notify Companies House. There is no need to attach these articles because you are not altering the statutory version.

If you choose not to adopt model articles in their entirety, you will be required to download the model articles, make the necessary alterations, upload the document as altered and attach it to your online application. Similarly, entirely bespoke articles will have to be uploaded and attached to your application.

Companies House will display your articles on the public register of companies along with the rest of your company’s details.

You will also be required to upload supporting documentation if your proposed company name contains any ‘sensitive’ words and expressions - visit our company name guidance section for detailed information.

Submitting your company formation application

When you are ready to send your online application to Companies House, check it carefully to ensure you have included all the relevant information, entered the details accurately, indicated the articles you wish to use, and uploaded any required additional documentation. When you are satisfied with your application, simply click ‘SUBMIT’.

Your registration form will be thoroughly examined by one of our specialist agents, before being electronically submitted to Companies House through a secure filing system. Applications are then checked by Companies House and, all being well, approved within 3 working hours. You will be issued with digital copies of your incorporation documents as soon as this happens, and you can start trading whenever you like.

All of the information provided on the application form will be placed on the official register of companies. This is available to all members of the general public. Residential address details will remain on a private register at Companies House, unless such an address is used as a registered office or service address.

When your company has been successfully incorporated, your next step will be to register with HMRC for the appropriate business and/or personal taxes. Visit our HMRC guidance section for detailed information.

What incorporation documents do I receive?

Certificate of Incorporation

Companies House issues a certificate of incorporation to all limited companies and LLPs to prove their legal existence and incorporation under the Companies Act 2006. Quality Formations will provide you with a digital version of this certificate by email immediately upon company formation. Some of our formation packages also include a paper certificate which will be posted to your registered office.

The certificate of incorporation will include the following details:

  • Full company/LLP name
  • Date of incorporation
  • Company registration number (CRN)
  • Country of incorporation
  • Type of company
  • Location of registered office
  • Incorporating legislation
  • Issuing registrar
  • Companies House seal

Memorandum and articles of association

If you register a limited company, you will also receive a digital copy of the memorandum and articles of association. You must keep digital or printed copies of these documents at your registered office or SAIL address for inspection purposes. You will also be required to refer to the articles on a number of occasions to ensure your company adheres to company law.

Share certificates

Digital share certificates will be issued to companies limited by shares. Again, you may receive paper copies of these documents, depending on your chosen company formation package. Each shareholder must be given a copy of his or her signed share certificate as evidence of their shareholdings in the company. Copies should also be kept at the registered office or SAIL address with your company’s statutory records.

Each share certificate will contain the following details:

  • Certificate number
  • Date of issue
  • Full company name
  • Company registration number
  • Shareholder’s name and contact address
  • Details of issued shares - quantity, class, and nominal value of the share

You must ensure the safekeeping of these incorporation documents, as they contain important information that you will need to refer to on a regular basis. You will be expected to provide copies of these documents to banks, lenders and investors in a number of situations.

LLP Agreement

If you register an LLP, you will receive a draft LLP Agreement that can be completed and returned to us by email. We strongly recommend the use of such a document to outline and clarify the rights and responsibilities of the partners. This will minimise the potential for confusion or disagreements during the course of business. You can easily change the particulars of the agreement at any time after incorporation, if need be.

Company Register with first entries

Your statutory company register with first entries (as per the date of incorporation) will include the following documents, where applicable:

  • Register of applications and share allotments
  • Register of members and share ledger
  • Register of LLP members
  • Register of transfers
  • Register of mortgages and charges
  • Register of debentures
  • Register of dealings or executions
  • Register of directors
  • Share certificate(s)
  • Register of PSC

You will be required to update the statutory register throughout the life of your company when certain details change. It is important that these records are kept up-to-date at your registered office or SAIL address for inspection purposes.

Rejected applications

Every now and then, a company formation application will be rejected by Companies House. This is usually the result of missing or inaccurate information. In the unlikely event that this happens, Companies House will inform you immediately and you will have the opportunity to address the error. You can then simply re-submit your amended application online on the very same day for no additional cost.

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« Quality Formations formed a new company for us with no problems whatsoever. All the options open to us were fully explained in detail. Could not have been simpler. »

Brian Smith

QUALITY FORMATIONS CUSTOMER

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