Is incorporation right for you?
Before incorporating a business, we would always ask you if it is the right thing to do. There are various pros and cons around incorporation, from taxation, to liability, to even how much you would pay an accountant to look after your business. Before making a decision, do consider if incorporation is right for you.
Incorporating a company
We will always check the above with you before moving ahead with any incorporation. We want you to be happy it’s the right choice. If it is, then we will walk you incorporating the company so it’s set up exactly as you require.
First, it begins by choosing a name. Each company name has to be unique and you can check if your desired name is available by checking here. Be mindful of trademarks, or similar names and read the rules over what is an appropriate name.
You then need to appoint your directors. A director is someone charged with looking after the company. They are responsible for running its operations and ensuring the accounts are filed correctly and on time. This is different from a shareholder, who owns the business, holds voting rights and can take a dividend from the company.
In most cases for small businesses, directors and shareholders will be one and the same, with shareholders receiving ‘ordinary’ shares for a notional value, such as £1 a share. However, there are sometimes cases where this might need to be different. You will need to also identify people with significant control (PSC). Again, in most cases, a PSC is going to be your shareholder.
You will need to also prepare a memorandum and articles of association. A memorandum is a legal statement signed by all shareholders agreeing to form a company, whilst the articles of association provide written rules as to how your company will be run. Usually, you will adopt ‘model articles’ but again there could be cases where you may need to adjust these.
Once that’s done, you need to give your company a SIC code (an identifier which defines what industry it serves) and then advise HMRC, so you become automatically registered for corporation tax. This can be done automatically, they will then provide you with a unique taxpayers reference (UTR) for your company.
In some cases, you may want to keep your company dormant, meaning you have reduced reporting obligations. This could be, for example, if you wish to reserve a name of a business now to avoid risking losing it in advance of commencing operations.
As you can see it’s a thorough process and we will walk you through everything from start to finish, explaining the process along the way and preparing you for your obligations as a director going forward.
Using a registered address
One potential downside to incorporation is that all records are public. This includes the legal address of the company, as well as the address of the directors in charge. In the absence of having a business property, this means the company will likely be incorporated at your own private address.
If you would sooner not have a reference to your own private address, we can offer a registered address service for a small monthly fee, subject to our terms and conditions of use.
Construction Industry Scheme (CIS)
If you’ re involved in the CIS, find out how we can help, whether you are a contractor, administering the scheme, or a subcontractor with deductions being made from your pay.
Ready to start the journey?
To get help with your accounts and start freeing up your time to focus on growth, talk to the Mayflower team today.