For those looking to learn how to incorporate a company, this comprehensive guide gives an overview of all the information you need, including the key documents required and a roadmap of the process from start to finish.

• Incorporating a new company
• Identifying proposed name
• Name principal business activity
• Provide registered office
• Provide company officers details
• Company secretary
• Details of shareholders
• Details of people with significant control
• Memorandum and articles of association
• Accounting period end date

Incorporating a new company

When deciding how to incorporate a company, it can be done in two ways; by submitting signed paper documentation to the Registrar of Companies, or  by using electronic filing methods.  We use the latter to take advantage of being able to incorporate new companies with ease, often on a same day basis.

To incorporate a new company, various pieces of information require to be submitted to Companies House, as set out below, on form IN01.

Proposed name

By identifying the proposed name for the new company, this allows us to identify sensitive words, or concerns surrounding names that may be considered to be the “same as” any existing registered name, along with any appropriate advice and supporting documentation to allow the proposed name to be submitted, if possible. This is considered one of the most integral stages when going through the process of how to incorporate a company.

Principal business activity

At least one trade classification code is required, or a brief description of the company’s business activity.  A full list of trade classification codes can be found via the following link: https://resources.companieshouse.gov.uk/sic/

Registered office

The registered office is the primary address at which the company may be contacted.  In accordance with provisions set out in the Companies Act 2006 (“the Act”), a company must have its registered office in the country of registration, therefore a company registered in Scotland must have its registered office in Scotland.

Company directors

A private limited company must have at least one director who is a natural person.  To incorporate a new company, each proposed director must provide the following details on the application to Companies House:

• Full Name;
• Date of Birth;
• Nationality;
• Business Occupation;
• Service Address; and
• Residential Address.

The director’s service address is shown on the public record to allow the residential address details to be protected, however a director may choose their service address to be the same as his residential address. Only the month and year element of the director’s date of birth will be disclosed on the public record.

Where a company chooses to have corporate directors (whether that be another limited company or an LLP), the corporate director must disclose certain details, depending on whether it is a European Economic Area (“EEA”) registered entity or not. Changes proposed in the Small Business, Enterprise and Employment Act 2015 will restrict a company’s ability to have corporate directors, except in limited situations (although the relevant provisions are not yet in force as of April 2021).

Company secretary

Since 6 April 2008, a private limited company no longer requires to appoint a company secretary, however the duties undertaken by a company secretary have not fallen away.  If you choose not to appoint a company secretary, these duties become the responsibility of the directors, or such person carrying out the company secretarial function, irrespective of whether they are formally appointed as company secretary.

The company secretary simply requires to disclose their full name and service address for recording on the public record.

Shareholders

On incorporation, a private limited company must have at least one shareholder, who holds at least one share.  There is no restriction on the nominal value of that share, and the subscriber shares (that is the shares issued on incorporation) can be issued as nil paid shares, with the obligation to pay the company for these shares at some point in the future.

Shareholders must provide their name and address, and the number of shares being issued to them will be recorded on the form IN01.

People with significant control

A person with significant control (“PSC”) is an individual or relevant legal entity if they meet one of the following conditions:

1. Hold, directly or indirectly, more than 25% of the shares in the capital of the company;
2. Control, directly or indirectly, more than 25% of the voting rights in the company;
3. Hold, directly or indirectly, the right to appoint or remove a majority of the board of directors of the company;
4. Have the right to exercise, or actually exercise, significant influence or control over the company; or
5. Have the right to exercise, or actually exercise, significant influence or control over a trust or firm which itself meets any of the above conditions.

The following information will require to be completed on the application to Companies House for any individuals that are PSCs:

• Name;
• Service address;
• Country or state of usual residence;
• Nationality;
• Date of birth (only the month and year element will be published on the records at Companies House); and
• Usual residential address (this will remain private and not published on the records at Companies House).

Where a PSC is not a natural person, and that entity has an obligation to maintain its own PSC Register, it is defined as a registrable Relevant Legal Entity (a “RLE”). A legal entity is considered to be an RLE if it meets any of the conditions to be recorded as a PSC, and:

1. It holds its own PSC register; or
2. It is subject to rule 5 of the FCA Disclosure and Transparency Rules; or
3. It has voting shares admitted to trading on a regulated market in the UK or EEA (other than the UK) or on specified markets in Switzerland, the USA, Japan or Israel.

An RLE is registrable in relation to a company if it is the first RLE in a company’s ownership chain. The qualifying criteria must be recorded against any registrable RLE, since it is still a PSC.

The PSC section of the application must be completed whether a company has a PSC or not. Providing the company has taken all reasonable steps and is confident that there are no individuals or legal entities which meet any of the conditions to be considered as a PSC or registrable RLE, the company must enter that fact on the application.

Memorandum and articles of association

In addition to the information set out above, which ultimately appears on form IN01, the proposed company will file a memorandum of association, which is a statement by the subscribers stating that they wish to form a company, along with articles of association,which together form the company’s constitutional documents.

Accounting period end date

Once the new company is incorporated, the directors may wish to amend the accounting period end date to a more suitable date, or in order to comply with the Companies Act’s requirements to ensure parent/subsidiary accounting period dates are aligned.

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