Note: This document is not complete.
This is what I did to register my private limited company.
- Did lots and lots of related reading, mainly of documents produced by the Business Link, Companies House and HMRC.
- Bought a book about company formation (called "Company Formation Made Easy").
- Decided that a private limited company was the right structure for my business.
- Determined who was going to be the company director (me) and who was going to be the secretary.
- Bought a copy of the Memorandum & (modified) Articles of Association (by Oyez), Form 10 and Form 12 from my local legal stationers. Note that Form 10 and Form 12 are available from Companies House, but you'll have to make sure that you get a top quality printout of them.
- Filled in the documents. The most complicated form to complete was the Articles of Association, because this lays out the legal jargon of the company. The articles can be vastly simplified if you state that the objects of your company is to "carry on business as a general commercial company", in which case you can delete all other objects (I did this by striking through every sentance and adding a signature at the end of each deleted paragraph).
- Signed the documents. This required signatures from the director (me), the secratary, and a witness. Form 12 also required a Solicitor to witness the signature (because it's a statutory declaration). This is a standard service offered by some solicitors, with a standard price of £5.
- Sent the forms to Companies House.
That's it! Two weeks later I received my certificate of incorporation. Note that this was sent to my address rather than the companie's registered address.
Complications
There were many and there will be many more.
The whole process involved a lot of complications that had to be overcome. I had problems at every stage of the process, from figuring out what forms I needed to fill in, through completing the forms, to actually posting them (to the extent that my closest postbox had been fenced off by builders and the second closest was too small for the envelope to fit!). Do not underestimate the problems you will experience. Estimate how long it will take you and quadruple it, at the very least.
- Name of company
- How to have only a single director
- Who to be secretary
- Director's personal tax status
- Where to get a witness for Form 12
- How many shares total and how many to issue (to myself)
- What the company's objects would be. Whether being a general commercial company is ok.
- Check that as a small business I'd be exempt from having to do an annual audit of the accounts (very expensive ~£1000).
- How to fund company
- How to fund myself - i.e. via company books or my savings, and related tax and NI implications.
- Whether to register for VAT or not
What's Next?
Tax in next. This is what I have determined from Working for yourself - The Guide from HMRC.
I could be completely wrong.
- Directors are counted as employees of the company but still need to register for self assessment with HMRC.
- Directors are employers too.
- Register the business for VAT with HMRC.
- Since employed, the company has to pay Class 1 National Insurance Contributions (NIC). Probably.
- A number of tax reliefs will be available for the business.
