This month we are looking at the key steps and points to remember when incorporating a new company
There are several ways to form a company:
online: either through a formation agent or Companies House via their online web incorporation service post: completing a hard copy form and sending this to Companies House. This method is usually more expensive but is however the best option for incorporating nonstandard companies, such as those limited by guarantee.
The first task is to check the index of names at Companies House to make sure the name you want is available. You can use the Companies House name availability checker on their website.
There are quite strict limitations on using names which are too similar to those already in use although there is an exception if an existing company is part of the same group as the new one and consents to the use of the proposed name. Certain words and expressions need prior permission before they can be used, so it is also worth checking the Companies House guidance on names before you begin to avoid the submission being rejected.
This may be private or public, limited or unlimited, limited by shares or by guarantee. There are also limited liability partnerships and other types of entity, such as community interest companies. Sometimes it is clear which type of entity is required but if in doubt, professional advice should be sought.
It is no longer necessary for a company to have 'objects' - a list of activities which it is permitted to undertake and for most commercial companies it is easier to now not to have these. However, some companies such as charities, who are required to have them, may benefit and they should be included in the articles of association.
Each company will need to select a Standard Industrial Classification code 'SIC code'. These are used by Companies House to classify the type of economic activity in which a company or other type of business is engaged. This information must be provided by all companies at the time of company formation, regardless of whether the business will be active or dormant.
The Office for National Statistics (as well as a number of other government authorities) use these codes to collate important data about the various types of businesses operating and trading within the UK.
Articles of Association
It is often quicker and easier to incorporate a company with standard model articles of association and then...