Company Formation In The UK – The Practical Guide
The United Kingdom has become an ultimate business hub for foreigners, given the ease of business, great economy, and stable politics. However, that doesn’t take away from the intricate and rather complex company formation laws. So, if you have been meaning to form a company in the UK without being there, we are here to help you out!
Deciding The Name
First of all, you need to decide the name of your dream business. This is the first step because there are naming rules implemented by the British company. Fortunately, the naming rules are not very extensive but still require compliance. So, when you are looking for your company name, consider the following details;
● The company name cannot be similar to the already-registered British company or the registered trademark
● The company name cannot be offensive
● The company name should not be connected to the UK government unless you get the approval
There is a company house register available online, so you can check the availability of the name and make sure no one else is using it already.
Select The Company’s Secretary & Directors
Once you have decided on the company name, you need to start assigning roles to the individuals that will be in the company. In particular, you have to think about the secretary and the company directors. For the company director, there are the following guidelines in the UK;
● Make sure there is at least one direction and there are no requirements related to their residency or nationality
● The director’s role is legally responsible for operating the company and needs to ensure proper preparation of reports and accounts
● The director must be over 16 years old and should not be disqualified from the previous company of the same role
● The company director needs to provide the service address and it must be publicly available. The company directors who want to use some home address that’s added to the Companies House register can ask the Companies House to remove that specific address from the register
On the other, we are sharing what to keep in mind while selecting the company’s secretary;
● This is not a legally required role but having one adds to the profile
● The company secretary can take on the responsibilities of the director
● The company secretary cannot be the auditor or an individual with an empty bank account
Selecting The Guarantors Or Shareholders
The companies that are limited by the shares need to decide the shareholders and additional details about the shares. The information about the shareholders should be provided when you are registering the company in the UK. In particular, you have to specify the following information;
● The names and contact details of the shareholders
● The number of shares of every shareholder type the company has along with the total value
● The rights of the shares provided to the shareholders
● You must specify if the shareholders can shift their shares for monetary outcomes or if the shareholders can vote on specific business matters
● Make sure to specify the extent of voting rights and how many votes are given to the share
Select PSC Over The Companies
PSC is the people with significant control over the company. The British companies need to maintain the beneficial owners' registry and people who can have a significant impact on the company. For this reason, it’s important to select and record the people who own or control the business decisions. As far as the legalities are concerned, if a person owns 25% or more part of the company, they need to be deemed the PSC. During the company incorporation process, the company must do the following;
● Select the PSCs of the company and confirm the information
● Record the data to the PSC register of the UK within 14 days of naming the PSC
● Provide all this information to the central public register of the Companies House within the next 14 days
In case of changes to the PSC, the updated information should be provided within the next 14 days of the changes.
Preparation Of Agreement To Run The Company
The incorporation process demands the companies to have the articles of association and memorandum of association. The memorandum of association is a legal statement that’s signed by the shareholders of the company and the written confirmation of their agreement to develop the company and keep in mind that it cannot be changed once the company is registered.
As far as the articles of association are concerned, it’s the legal statement that identifies how the company is decided to be operated and includes the rules that are agreed by the shareholders, secretary, and directors of the company. In addition, you can get the templates to draft this document by the Companies House.
Getting The Registered Office Address
The UK registered companies need to have a registered office address where the official information and documents will be sent to. The address can be obtained before the company registration process is started. The registered office needs to have a physical address, must be in the same company where a company is registered, and a utilizable P.O box along with the postcode and physical address. If you don’t reside in the UK, you can have the agent obtain the office address for you.
Identify The SIC Code
The SIC code is the company’s standard industrial classification of economic activities. The SICs are meant to provide an understanding of the business’s scope and nature. When you set up the company in the United Kingdom, the SIC code should be delivered to the company's house at all costs.
Submit The Registration Application
Companies House is known as the official company registrar of the United Kingdom. It’s a government authority where all the business incorporation and registration applications should be sent. As far as the registration application submission is concerned, it can be sent online, through the mail, or by an agent. If you want to send it by mail, download the form IN01.
To summarize, if you want to form a company in the UK, BizVee can be of great help as they can handle the legislation and documentation process of company formation. Moreover, they can help you become an Amazon seller verified UK and US and have a PayPal verified account. So, whether you want a verified account for PayPal or Amazon, BizVee can help!