Company Incorporations: A handy guide to getting started
Have you decided to set up a company? If so, congratulations! In this article, we guide you through the key areas you need to consider.
Choosing a name is one of the most exciting decisions about setting up a company, but there are rules you need to consider. For example, you cannot use a name which is the ‘same as’ an existing company, the name cannot contain anything offensive and you might need to seek permission to use certain words.
Here are some useful links to check your chosen company name:
All limited companies must be assigned at least one SIC (‘Standard Industrial Classification’) code in respect of their business activity.
You can select a maximum of four codes. The available codes may be viewed here.
Registered Office Address
The Registered Office address must be a physical address located within the jurisdiction of your company (so a company registered in England and Wales cannot have a Registered Office in Scotland).
You may not wish to use your home address as the Registered Office, as this cannot be suppressed or removed from the Companies House public record at a later date.
If you are a Gerald Edelman client, you can use our office at 73 Cornhill as your company’s Registered Office for an annual fee.
All companies need at least one director, who must be at least 16 years old and a ‘natural person’.
Directors’ dates of birth and home addresses are registered with Companies House, but they do not need to be disclosed on the public record in full. Dates of birth are redacted to show only the month and year, and each director may choose to use a ‘Service address’ so that their home address does not appear on the public record. Unless specified otherwise, we would use ‘The Company’s Registered Office address’ as a default for privacy.
Private limited companies are no longer legally required to appoint a company secretary, so there is no need to have a company secretary and most clients do not appoint one.
If you do wish to appoint an individual as the company secretary, less personal information is required than would be needed for a director.
If you would like to appoint our corporate company secretary, E L Services Ltd, this can be arranged – please speak to your Gerald Edelman contact or speak to our team. Appointing our corporate secretary is not a requirement for becoming a company secretarial client with Gerald Edelman.
Number, Type, and Nominal Value of Shares
It is important to get the right share and ownership structure for your new company. A commonly seen ‘default’ position is to issue 100 Ordinary shares of £1.00 each – but please speak to an advisor regarding the right share structure for your company.
The first shareholders (also known as subscribers) for your company may be individuals, corporate entities or a mix of different parties. The initial subscribers cannot include joint shareholders.
For all new shareholders, we will need full details including the number and type of shares to be issued to each subscriber.
Individual shareholders’ home addresses are registered within our software, but they do not need to be disclosed on the public record in full. Individuals may choose to use a ‘Service address’ so that their home address does not appear on the public record. Unless specified otherwise, we would use ‘The Company’s Registered Office address’ as a default for privacy.
Some shareholders may be registrable as a Person with Significant Influence or Control (for example, if they hold more than 25% of shares or voting rights) – in which case additional personal information will be registered with Companies House, in much the same way as for directors (as above).
For all shareholders (individuals or the authorized signatories of corporate shareholders), we will need full PIN details. This is in no way linked to a bank card PIN! It is simply a series of letters and numbers created from personal information, which then acts ‘like’ an electronic signature to authenticate that shareholder online for the company incorporation application. We won’t be able to proceed to incorporate without the PIN detail for all subscribers.
Persons with Significant Control (PSCs)
Usually, PSCs would be shareholders who are registrable by virtue of owning more than 25% of shares and/or voting rights.
However, there may also be parties connected with your new company who do not meet the criteria of holding 25% of shares and/or voting rights, but still exercise ‘significant influence or control’ over the company.
For any individuals who are registrable as PSCs by exercising (or having the right to exercise) significant influence or control over the company, please provide their full details. As is the case with directors, dates of birth and home addresses are registered with Companies House, but they do not need to be disclosed on the public record in full. Dates of birth are redacted to show only the month and year, and each director may choose to use a ‘Service address’ so that their home address does not appear on the public record. Unless specified otherwise, we would use ‘The Company’s Registered Office address’ as a default for privacy.
Please contact us if you have any queries regarding your new company’s PSCs’
Trust arrangements arise when a trustee (or ‘nominee’) is registered as the holder of the shares, but the shares are held on behalf of a ‘beneficial’ owner.
If any trust arrangements may be required for your new company speak to an advisor who can guide you through the process.
The preferred year-end relates to the accounting year-end (or ‘accounting reference date’) for your new company. The default year-end for new companies would be the same month as the month in which the company is formed plus one year (so a company incorporated on 5 January 2022 would have a default year-end of 31 January, and the first accounts would be for the period ended 31 January 2023).
You may wish to have a different year-end for the accounts, for example, aligning with the tax year or calendar year. If you wish to discuss accounting year-ends for your new company, speak to our Company Secretarial team today.