Understand the necessary tasks that need to be carried out to create a compliant UK company
So, you have had an exciting, innovative idea, and you have decided to start a business. To set up a private limited company, you will need to register with Companies House. This is known as business incorporation and to incorporate your business, you will need the following:
- A company name
- A registered office address
- A minimum of one director
- At least one shareholder (or more) and the share details
- A SIC code (classifies your business)
- Memorandum and articles of association (an agreement and rules made by the shareholders to create the company)
- PSC (people with significant control) details
Submitting these documents to Companies House to register your business is the first step to setting up your new company. After this, you should receive the Certificate of Incorporation and other documents confirming the registration in the post, but what next?
There are countless things to consider after company formation; our blog will outline some of the essential points to consider, aiding to your company’s successful development.
1. Statutory Register
The Certificate of Incorporation from Companies House confirms your business registration, but it does not prove you own the company. Additional legal documents must be completed to register company owners.
These documents should include:
- A statutory register of members – This is a list of company shareholders including the original subscribers to the memorandum of association. The information listed should state the name, address, the number of shares, class share, and the date when they were issued.
- A statutory register of appointed directors – this should include the full names and addresses of directors and the director specific interests in company assets.
- A statutory register of charges on company assets – as well as being included on the company statutory books, a separate register of charges, mortgages and debentures must be kept by your business.
2. Register for Corporation Tax
HMRC require you to register for Corporation Tax within three months of starting a business. Activities which identify your company is trading includes buying, selling, advertising, renting a property, and employing someone. So once any of these activities begins you have three months to register for corporation tax.
3. Open a business bank account
Setting up a business bank account can help you manage your company’s cash flow. It is essential to have separate personal and business accounts; this will prevent them from interfering with each other and will make keeping financial records easier. It can be a lengthy process to open a bank account (depending on your company structure and personal circumstances), so be proactive and start the process as early as possible.
Our consultants at More Group are highly talented business banking specialist who can help you complete this process efficiently.
4. Register for VAT
The amount of VAT you pay, or whether you need to pay VAT at all, will make a big difference to how you price your product or service. Therefore, it is essential to investigate this early on and work out what VAT your business is liable to pay. VAT registration requirements and rates will fluctuate depending on where you are conducting business.
If you are going to trading overseas in multiple locations, you might be paying different rates of VAT in different countries, so be extra vigilant. In the UK you only need to register for VAT once your turnover surpasses £85,000 per annum.
Most countries in the EU do not have VAT registration thresholds, so in these countries, it is essential all businesses register for VAT. To ensure your business is compliant with VAT it can be helpful to consult a VAT specialist.
At More Group we offer VAT services, so as a client you can feel confident you are paying the correct amount of VAT.
5. Setting up payroll
Whether this is paying yourself or staff, you will need to establish a payment system.
The Pay As You Earn (PAYE) system is a legal requirement for businesses. It is HMRC’s way of collecting taxes from employees. Under this system, you deduct income tax and national insurance from your employees before paying them their wage. You can choose to operate PAYE either by hiring an accountant or using payroll software to do it yourself. Many businesses find it beneficial to outsource payroll to specialists who are experienced in setting up and running payroll.
At More Group we can offer you expert payroll services, giving you one less thing to worry about as a business owner.
If you have shareholders in your business, you will need to set up dividend payments. These pay shareholders after-tax dividend profits set these up to keep your investors happy.
6. Annual requirements
Every year your business will have to submit annual statements to Companies House. Failure to provide these documents will result in a penalty and if this persists your business could be shut down.
The documents that must be submitted include annual accounts, confirmation statement, and a corporate tax return. Be proactive as a business owner, research what requirements each of these documents should have and put the deadlines on your calendar.
Alternatively, you could partner with a professional accountant at More Group who can complete and submit these documents on your behalf. We will ensure your documents are prepared to a professional standard and are submitted on time.
Should you get professional help?
Many businesses find it beneficial to hire a company formation specialist early when setting up a company. Working with a professional can help you to give your business a better start. With expert help, you can build a robust business structure to suit the nature of your unique business. As your company develops you will be thankful that you invested.
If you are interested in working with one of our experienced professionals to help build your business, contact us to book a for a free initial consultation.
Note: The information should not be construed as legal or other advice as it designed as an information source only © More Group 2018. All rights reserved.