subject: Understanding Limited Companies [print this page] When you set up your business for the first time it can be a daunting and challenging time. The process for setting up a business can be a minefield if you have no previous experience. It is of utmost importance to find an accountant who has a sound grasp of your business model and can help you to minimise the level of tax that you are likely to pay. This is an important step as building a good professional relationship with an accountant can make all the difference to the success of your business.
When forming a limited company there are certain steps you need to take. Companies House is responsible for company formation in the UK and it is here that you need to send certain documentation and information to set up your company. This is another area where you can gain third party help to ensure you set up the company correctly at the outset.
There are three basic types of limited company - the first is a privately owned company limited by shares, the next is a privately owned company limited by guarantee and the finally a public limited company. A privately owned company and one limited by shares are the same with the latter having share capital. A company limited by guarantee is where members contract to pay a certain amount of money should the company hit liquidation.
A public limited company means that shareholders have agreed to pay the difference on any unpaid shares. Normally this would be zero as most shares are provided fully paid. There is always a limited liability for share holders. It can seem very complicated however working with a professional accounting firm can help you to decide which type of limited company is best for you.
At Churchill Knight Associates we offer a comprehensive service to those looking to set up a limited company.
