Private Limited Companies – Startup Essentials

Starting and operating a private limited company is vital to entrepreneurs and small businesses considering the benefits, but the setting up can be complex. That is why the need arises for taking the help of a company formation agent. Professional services from Companyformations24.7 are available 24 hours a day, 7 days a week, to make this job easier.

A private company limited by shares is one type of company that can be incorporated under the UK laws. Its shareholders have limited liability restricted to the original capital investment, i.e. a shareholder’s personal assets are protected but capital invested in the company may be lost in case of the company’s insolvency.

The disclosure requirements of a private limited company are lighter and its shares cannot be offered to the general public, and hence cannot be traded on a public stock exchange. This is the key distinguishing feature of private limited companies from a public limited company set up. Most small businesses are private and operate as private limited companies. The UK Companies Act allows one or more persons to start and operate a private limited company for lawful purpose.

A private company can be a single member company, limited by shares or guarantee and incorporated with one shareholder or member. A single member – present in person or proxy – at a meeting of shareholders can constitute a quorum unless specified otherwise by the Articles of Association. The minutes of such a meeting must be recorded and the decision of the single person must be communicated to the company in writing.

Limited company set up requires formally appointed company officers. A private company is required to have at least one director and secretary. At least one director has to be an individual and not another company. From April 2008, the requirement for a private company to have a company secretary has been made optional instead of mandatory. No formal qualifications are required for a person to be a company secretary.

A share capital of GBP 1 is sufficient to start a private limited company. UK laws allow private limited companies to be started with any number of shares of any value. Shares of such companies are transferred through private agreement and not traded on a public stock exchange. The Articles of Association usually place restrictions on the transfer of shares.

The first accounts of a private company must start on the day of incorporation. The first financial year must conclude on the accounting reference date or within seven days on either side of that date. The Companies House sends an intimation to the company for filing requirements well in advance of the incorporation anniversary. Delay in submitting accounts attracts penalty.

Every private company is supposed to have a registered office, which may not be its regular business address. Companyformations24.7 not only offers this address but ensures quick and easy set up of private limited companies. For such a formation, they also offer many other services besides their online company formation services.