Private Limited Company in the UK

Registration procedure

The registration procedure consists of four stages:

1. Selection of the company name, legal address and preparation of statutory documents

   The name should be unique, it should not contain invalid words (there is a whole list) and should end with the word “Limited” or “Ltd”. If the company is registered in Wales, you can use the Welsh equivalents of “Cyfyngedig” or “Cyf”.

   All official messages, for example, letters from the state register - Companies House - will be sent on the legal address. This must be a physical address in the UK, located in the same country where the company is registered. For example, a company registered in Scotland must have a legal address in Scotland. It is possible to use the PO Box, but you still need to include a physical address and zip code.

   The company’s legal address will be publicly available in the register online.

   The following constituent documents are necessary for the registration of the company:

   • The Memorandum of Association is a legal statement signed by all the initial shareholders who agree to form a company;
   • Articles of Association are written rules on the management of the company, agreed by the shareholders, directors and secretary of the company

   You can prepare them yourself using standard Companies House templates, or ask specialists for help.

2. Company registration in the Companies House

   In order to register a company in the Companies House, you must fill out a special form, attach the necessary documents and pay the registration fee. There are three ways to do this:

   1. Online registration. It is possible only with the use of a model Articles of Association.
   2. Registration by mail. A special form of IN01 is filled in and signed. It is sent by mail together with other documents.
   3. Registration with the help of an agent
   4. Registration with third party software (as a rule, all agents have such software)

   After registration of the company, a “Certificate of Registration” is issued. It confirms the legal force of the company, it contains the number of the company and the date of its registration.

   Further within 3 months after the beginning of the activity, the company must be registered as a taxpayer.

3. Registration with Her Majesty’s Revenue and Customs (HMRC) for corporate tax and VAT payment

   Within a few days after the company’s registration with Companies House, the HMRC sends a 10-digit unique taxpayer number (UTR) to the legal address of the company. This number will be indicated on all letters from the HMRC and in online services. Using UTR, it is necessary to register the company as a payer of corporate tax in the HMRC in the electronic mode.

   The following data will be required:

   • Company Registration Number
   • Date of beginning of the company’s activity (the first reporting period of the company will start from this date)
   • The date to which the company’s annual reports are compiled

   Then the HMRC will inform the company on the timing of corporate tax payment. The tax return of the company will have to be filed even in case of unprofitable activity or lack of corporate tax.

   The company must register as a VAT payer if the volume of its taxable supplies of goods or services in the UK for the previous 12 months has exceeded the threshold (as of June 2017, it is £85,000), or it is expected to approach the threshold within the next 30 days. However, the company can also voluntarily decide to register as a VAT payer, even if the volume of its supply does not exceed the established threshold.

   You can register as a VAT payer through the HMRC website or by sending completed forms by mail.

4. Registration for the deduction of income tax from employees’ salaries, as well as employer’s liability insurance

   Registration for income tax deductions can also be made online at the HMRC website.

   The legislative requirement of the minimum amount of employers’ liability insurance in the limit of compensation is in the amount of £5 000 000. For lack of employer’s liability insurance, a fine of £2500 per day is provided.

1. Certificate of Collation
   • Certificate of Incorporation
   • Memorandum of Association
   • Articles of Association
   • Minutes of the First Meeting of the Board of Directors
   • Resolution of Shareholders
2. Certificate of Incorporation
3. Memorandum of Association
4. Articles of Association
5. Minutes of the First Meeting of the Board of Directors
6. Resolution of Shareholders
7. Share Certificate
8. Declaration of Trust
9. General Power of Attorney
10. Stock Transfer Form
11. Letter of resignation from the director
12. Agreement for the Provision of Nominee Services
13. Seal

Requirements to the authorized capital and shares

• The minimum amount of the authorized capital is 1 share, the maximum amount is not established
• Requirements for the nominal value of shares are not established;
• Shares can be simple (they can be divided into different classes by value), preferred and redeemable;
• Issue of bearer shares is prohibited;
• The company may increase the share capital by issuing additional shares;
• The company can reduce the share capital only under certain conditions.

Requirements for the Director

• It has at least one director;
• The director can only be a natural person;
• The director can be both resident and non-resident of Great Britain;
• Director(s) prepares and submits the Confirmation Statement to the Companies House, annual financial statements, notifications of changes in the company, distribution of shares;
• Information about the director when registering a company or any replacement of a director is filed in an open state register and is public. Information on directors is also contained in the Register of Directors (previously, it should have been stored in the company’s office, now it can be stored physically in the Companies House).

Beneficiary

All British companies are required to create and maintain a register of persons with significant control, known as PSC. This information should be submitted annually to the Companies House in one of the sections of the Confirmation Statement. A part of the information on persons with significant control (namely their names, addresses for correspondence, citizenship and country of residence, nature of control, the dates from which the information about them is subject to submitting to the PSC) is available to the general public, the rest of the information (exact addresses of permanent residence, dates of birth) is available only to the employees of authorized bodies on special request.

Requirements for shareholders

• Shareholders of the company can be both natural persons and legal entities.
• Shareholders of the company can be both residents and non-residents of the United Kingdom
• The minimum number of shareholders is 1
• The information on shareholders is submitted to the open state register and is publicly available. The information on shareholders and shares held by them is also contained in the Shareholders Register, which must be maintained by each company

Office of the company

• There is a requirement for the legal address of the company, which should be real
• The legal address must be in the same country in which the company is registered (for example, if the company is registered in Scotland, its legal address must be also in Scotland)
• The company must not necessarily carry out everyday operations at the place of the legal address
• The information on the legal address is contained in the public register

Reporting, audit

• The directors of the company are responsible for the preparation and timely submission of the annual Confirmation Statement and financial statements
• Financial statements should be accompanied by the reports of directors and auditor’s reports
• Audit is mandatory for all companies except small ones (they meet two of the requirements - the annual turnover is less than £6.5 million, the balance is less than £3.26 million, the average number of employees is less than 50)
• The reporting period is a year. The beginning of the reporting period is the date of registration of the company. Reporting must be held one year after the date of registration (or the reporting date) with a margin of up to 7 days earlier or later;
• A copy of the annual report must be received by all shareholders of the company.

Great Britain's Corporate Law