A company name must not be offensive or suggest any connection with government or public authority, unless permission is granted by the Secretary of State.
The registered office is the official address to which all communications and notices may be addressed. The company must at all times have a registered office and this must be a physical location and not a PO Box address. The country of the location o...
Who is a director? What are their legal responsibilities?
The legislation governing the appointment and removal of directors is contained in the Companies Act in Part 10 and comprises nine chapters and over 100 sections. Inevitably this section of our website cannot cover all the aspects of the Act, but endeavours to ...
The general duties required of a director are set out in seven sections of the Companies Act.
The company is required to keep directors' service contracts or any memorandum of terms at the company's registered office, or at any place specified under section 1136, as section 229 confers rights on members to inspect a request copies.
Companies Act provisions protecting directors from liability
The position of company secretary in a private company is now optional. Thus a company can operate with a sole director.
It is essential that you keep your company's statutory records up-to-date. Do not underestimate the importance of these records - they are definitive proof of the company's legal existence and its members.
An auditor of a private company must be appointed for each financial year of the company, unless the directors resolve otherwise on the grounds that audited accounts are unlikely to be required.
Auditors are appointed by the members and are accountable to them. As a result it is important that auditors are given the information they consider relevant to the fulfilment of their duty to members.
The turnover threshold which currently exempts most companies from a statutory audit is £6.5 million. However, small companies still have to produce full statutory accounts.
The Companies Act requires that all companies must keep a register of members
Shares in a limited company having share capital must each have a fixed nominal value and a share must be distinguished by its appropriate number, unless if at any time all the issued shares in a company are fully paid up and rank pari passu for all p...
The Companies Act permits a company to make a loan to a director. A loan or guarantee must be approved by a resolution of the members of the company. A resolution giving the necessary approval can only be passed when a memor...
Where a service contract is, or maybe, longer than two years.
This is a complicated area of the Act and we recommend that advice be sought with regard to long term service contracts.
One of the requirements of the Companies Act is that the approved accounts must include a directors' report
Subject to certain exemptions, a company that meets the small company criteria in respect of a financial year is exempt from the requirement to have an audit of accounts for that year.
Companies are automatically fined if accounts are not submitted on time. Accounts should be normally be filed for a private company ten months after the company's accounting reference date (reduced to nine months for accounting periods starting on or after 6 April 2008).
The Companies Act requires a company to keep records of its director's meetings. The responsibility for these records rests with the company's Board of Directors.
A private company (not subject to insolvency proceedings) can apply to the Registrar of Companies to be struck off the register and dissolved.
Suggestions on how to reduce the time taken in accounts preparation.
The Companies Act prescribes that every company must keep adequate accounting records
A company's financial year is determined by its accounting reference date in each calendar year.
The requirements of the Companies Act regarding the preparation of group accounts are based on the company's size.
As accountants and business advisers we get to know our clients very well. From our position, it is all too clear to us that many clients are too focused on 'today' to give serious thought to the future.
The Companies Act permits a company to change its name. The provisions governing name change are found in sections 78 and 79. This may be achieved either by special resolution of the members or by other means provided by the company's articles. There are also p...
The Companies Act requires that a company may not take part in an arrangement under which another person enters into a transaction that, if it had been entered into by the company, would have required approval under sections 197, 198, 200 or 201, and that person, in pursuance of the...
A private company is not required to have a secretary, while a public company must have a secretary.
Details of corporation tax and company tax returns.
If two or more companies are controlled by the same person or by 'connected persons' (such as husband and wife, or father and daughter), the amounts above are divided by the total number of companies.
Details of how the tax system works with company cars.
In many small companies, the owners are also the directors, and this gives considerable scope for deciding how profits should be taken out of the company.
The relief is intended to produce a net tax rate of 10% on the disposal, although for those making modest gains there is a slight increase in the actual tax burden compared to that payable under business asset taper relief because the CGT annual exemption saves less tax under this relief (at 18%) than it did under taper relief (at 40%).
Expenditure incurred before the company year end might reduce the current year's tax liability instead of next year's. Bringing forward expenditure by even a few weeks on, for example, building repairs, advertising, sales and marketing campaigns, and any other item deductible from profits can accelerate the tax relief by twelve months.
The rules which determine what expenses can be deducted from profit for tax purposes are essentially the same whether you trade through a limited company or a sole trade or partnership.
Benefits in kind are assessed on all directors and employees whose salary and benefits combined are £8,500 or more. Remuneration by way of benefits is often attractive to employees, especially if they are paying the higher rate of income tax, because the benefit may either be tax free or subject to less tax.
Details of corporation tax rates and bands.
Make sure you do not become liable to any of these penalties.
A summary of the main allowances available.
Capital allowances for the construction costs of industrial buildings or structures fall under several different headings, but collectively they are known as industrial buildings allowances.
HM Revenue & Customs charges interest on underpayments of tax, and pays interest (repayment supplement) on overpayments. The rate of interest paid on overpaid tax is lower than the rate charged on underpayments, and interest rates are adjusted frequently in line with commercial interest rates.
In order to attract a deduction in computing the profits of a trade or business any expenses must be incurred wholly and exclusively for the purpose of the trade. Capital expenditure is not an allowable expense (capital allowances are claimed on these costs), and certain other expenses are barred by statute.
The Companies Act comprises approximately 1,300 sections and introduces new legislation which reflects the changing business environment.
There are over 100 forms prescribed by the Companies Act 2006. We list below the main forms and include a link to all the forms which can be downloaded direct form Companies House.
We are often asked, 'Should I form a limited company?' The reality is that there is no easy answer. Each situation has to be judged individually. As well as the obvious issues of tax and national insurance.
If time is an important factor, you can consider buying a ready-made company. The exact procedure will depend on the company formation agents, including online agents, involved.
There are a number of schemes intended to encourage employers to make arrangements for their staff to travel to work by more environmentally beneficial methods.
