Company Formation

Company formation is the process of incorporating a business as a limited company. Once a business has been incorporated it is then considered as a completely separate entity to the people who own/operate the business.

Typically a specialist solicitor will be able to form a company for a fixed fee and on the same day, electronically, forming a company using the paper filing method can take up to 4 weeks.

Most solicitors offer basic company formation packages for less than £100 plus a further £20, which is the cost for filing with Companies House. However, this fee does not include the cost of witnessing documents nor does it include preparation of a company’s memorandum, its articles of association, or any Shareholders Agreements, which would be carried out and charged for separately.

The Articles of Association set out the rules that govern the running of the company's internal affairs and they must be signed by each subscriber in front of a witness, who must then attest the signature prior to them being registered at Companies House.

A Memorandum of Association contains the names and signatures of each of the subscribers wishing to form the company and where a company is to be limited by shares, a commitment from them to take at least one share each.

In addition, Form IN01 details the location of the Registered Office, which will be in either England and Wales, Northern Ireland, Scotland or Wales, details of the nominated company Secretary, its Director(s) and, in the case of a company limited by shares, the details of subscribers and their share capital. The form also includes the Statement of Compliance that confirms requirements of the Companies Act have been complied with.

The following types of company can be formed at Companies House:

• Public limited company (PLC)
• Private company limited by shares (Ltd, Limited)
• Company limited by guarantee
• Unlimited company
• Limited liability partnership (LLP)
• Limited partnership (LP)
• Community Interest Company (not for profit)
• Societas Europaea (SE): European Union-wide company structure
• European economic interest group (EEIG)

Forming and then running a company brings certain responsibilities that should not be taken lightly. A specialist solicitor can help you understand these and other duties that are involved.