Starting a business in the UK is exciting as well as rewarding. However, the level of commitment required to make your business a success should not be ignored.
Here is an introduction to help you start a business in the UK:
You are required to register your business with the Registrar of Companies: Companies House before starting operations. You can handle the registration process on your own or you can seek services of professionals such as company formation agent, solicitor, or accountant.
Set up and register a limited company (Public or private)
1) Registration documents and forms:
You are required to send many documents and completed forms to Companies House. The documents that are required to set up a limited company in the UK are:
2) The Company's Officers:
The officers of the company are people formally appointed to run the company and include its directors and company secretary. The rule states that officers should be in place at all times and their names and addresses should be mentioned on the company's registration documents. The number of company officers that a company is required to have depends on the type of company, private or public.
Private: At least one director, it should be clearly mentioned in Articles of Association that company has only one director. A Company secretary is not essential.
Public Limited Company: Should have at least two directors and a company secretary. The company director should hold formal qualification required to handle the job.
Company Director should be at least 16 years of age but there is no maximum limit of age applicable for director. Every business should have a minimum of one director who is a “natural person” and not another company.
3) Naming of Company:
You can't choose a name for a company that already exists. Also, the name should not sound offensive to people and shouldn't be too similar to any existing name. You also cannot have misleading names that give the wrong idea to the public.
You are required to have a special approval for a name that:
4) Registration Costs:
The standard registration fee charged by company houses is approximately 20 pounds. But, it is also possible to get the registration done on the same day by paying a premium fee which is approximately 50 pounds. You can obtain memoranda and model Articles of Association from Company houses.
Company houses can guide you on the basics of registration but they will not provide any detailed advice on drawing the necessary documentation.
The Companies Registrar forwards the registration process details to HM Revenue & Customs (HMRC). You are also required to contact the local HMRC office to inform them about your company's existence. Failing to do this attracts penalty.
5) Tax Matters of Limited Company:
Limited companies are required to pay corporation taxes over income and profits. It is also the company's responsibility to collect and pay income tax and National contributions of its employees and its directors. Failing to comply with this requirement attracts penalties.
It is necessary to seek professional guidance while setting up business in the UK. It will not only save you time but will also help you understand the rules and regulations in an efficient manner. They can also help you understand the tax payment system which will help your company when you need to make returns.