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What
is a Limited Company?
A limited company is a
separate legal entity created by incorporation at Companies
House. Once incorporated Companies House issue a certificate and
company registration number. This becomes the company's ID so to
speak. You can change the company's name at any time but you
still keep the registered number. The profits, losses, assets
and liabilities belong to the company. The company is then owned
by its members (the shareholders) and run by the managing
director directors. This gives the directors Limited
Liabilities. If the company should fail the directors personal
assets are protected. Because a company has a life of its own
the business can continue to trade despite the resignation or
death of any directors or shareholders. Other reasons for
choosing a Limited company could include ownership of property,
obtaining outside finance, taxation, status and protection from
risk.
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Choosing a name for
your company?
Every company has its name registered at Companies
House. No two UK companies can have the same name or names that
are similar to another company, so as to cause confusion.
Certain words and phrases are classed as sensitive by the
Department of Trade and Industry. If this is the case you will
be prohibited from using them or you might have to justify you
are entitled to use the name. We can arrange your justification
if necessary. For more information on this subject see
Companies House notes CHN2, CHN3 & CHN11 .
Also with the Internet growth these days you might want to have
your company on the internet, it would be an advantage to have
the same domain name, as your company name. You can check
the availability of Domain names here
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How long will it take to
form my company?
This varies depending on how busy Companies House is but
standard formations normally take 24 hours. If they come through
any sooner they are automatically sent out to you by courier on
the day we receive them back from Companies House as long as
payment in full has been made or by email if you have ordered
the paperless version.
Readymade companies are available immediately and the documents
are delivered by courier in the UK mainland the following
working day.
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Which type of company do
I need a Ltd or PLC ?
A LTD company is the most common type, this is a private
company limited by shares. We form the LTD company with an
authorized share capitol of £1,000. This is then divided into
1,000 x £1 shares. You can then issue as few or as many of the
shares as you want. As long as the shares you have issued are
paid for in full, if the company liquidates, the shareholders
have no further liabilities. If the shares have not been paid
for the shareholders are liable for the value i.e. if they
have 100 £1 shares, they only are liable for £100
A PLC company is a public company and may be listed on the Stock
Exchange or the Unlisted Securities Market (if wanted) a LTD
company cannot. Before a PLC can start to trade it must have at
least £50,000 of shares issued and at least 25% of the value
must have been paid for. A PLC company has a better status due
to its larger capital
Companies House notes CHN30 explain further about share capital.
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