So you you’ve done the hard bit now and secured your first contract, or perhaps you’ve decided to move away from an Umbrella Company to run your own Limited Company. Either way, it’s important to get the structure and set up right at the beginning so here’s our guide on setting up a limited Company.
After you have weighed up all the options and decided this is the right way for you then the process is quite straightforward. All new companies must first be registered at Companies House, so visit their website here (link to http://www.companieshouse.gov.uk/) then follow these steps:
1. Choose a company name remembering to take into consideration some of the rules around this. It cannot be the same or similar to an existing company name or cannot breach any trademark rights. Most people will use their surname or initials or feel free to be more creative taking care to avoid ‘sensitive names and expressions’ and bear in mind the company name will be used on formal contract agreements.
2. Now you need to appoint directors to your company. Since the implementation of the Companies Act 2006, your company can be run with just a sole director, more than one director and/or a company secretary if you want to structure it in this way.
3. You need to decide whether you are splitting the shares with another person or retaining them all yourself. The structure of your company may well dictate the distribution of shares.
4. You must provide the address and personal details for the appointed director(s) during the formation of your company including names, addresses and dates of birth.
5. After you have completed the formation of your company you must provide various forms to Companies House to support your application including Memorandum of Association, Articles of Association and a completed form INO1.
Although it is straightforward, many contractors decide to use a company formation service. Most accountants will also provide a company formation service at a minimal cost and is a hassle-free option to take. You will need an accountant to provide support in filing your year-end tax return.
For more advise or support on this please get in touch with any Be-IT consultants who will be happy to provide direction in what can be a daunting but a relatively pain free process.