INTRODUCTION
There are four main types of company:

	Private company limited by shares - members' liability is limited to the amount unpaid on shares they hold. This includes those community interest companies (CICs) which are private companies limited by shares.
	Private company limited by guarantee - members' liability is limited to the amount they have agreed to contribute to the company's assets if it is wound up. This includes all RTM (Right to Manage) companies-, common hold associations and those community interest companies which are companies limited by guarantee.
	Private unlimited company - there is no limit to the members' liability.
	Public limited company (PLC) - the company's shares may be offered for sale to the general public and members' liability is limited to the amount unpaid on shares held by them. This also includes community interest public limited companies. (that is, CICs which are PLCs).

The Companies Act generally allows one or more persons to form a company for any lawful purpose by subscribing to its memorandum of association. However, a public company or an unlimited company must have at least two subscribers. Information about companies formed by a single person can be found below. (In law, 'person' includes individuals and companies.)

CHOOSING THE NAME
You will find the relevant law in the Companies Act 1985 and in the Company and Business Names Regulations. In relation to commonhold associations and RTM companies, further restrictions are contained in the Commonhold Regulations 2004, and the RTM Companies (Memorandum and Articles of Association) (England) Regulations 2003 and the RTM Companies (Memorandum and Articles of Association) (Wales) Regulations 2004.

In relation to community interest companies (CICs) the relevant law in the Companies (Audit, Investigations and Community Enterprise) Act 2004 is referenced on the CICs website at www.cicregulator.gov.uk.

The following words imply national or international pre-eminence:

	British - approval of this word in your company name will depend on how it is used. Normally the Secretary of State would expect the company to be British owned. You would need to show that the company is pre-eminent in its field by providing supporting evidence from an independent source such as a Government department or a trade association.
	England, English, Scotland, Scottish, Wales, Welsh, Ireland or Irish - if you wish to use these words as a prefix to your company name, the rules are similar to those for 'British'.
	European - names which include this word will not be approved if they unjustifiably imply a connection with official bodies of the European Union. If there is a genuine connection with an official body, the name may be allowed if the appropriate body supports the application.
	Great Britain or United Kingdom - if you wish to use these expressions as a prefix, or to use 'of Great Britain' or 'of the United Kingdom' as a suffix, then the criteria are the same as for the 'British'.
	International - if you wish to use this word as a prefix, you need to show that the major part of the company's activities is in trading overseas. If you wish to use it as a suffix, then approval will usually be given if you can show that the company operates in two or more overseas countries.
	National - the criteria for use of this word are the same as for 'British'.

The following words imply business pre-eminence or representative or authoritative status:

	association, federation or society - if you wish to use one of these words, your company would normally be limited by guarantee.
	authority, board or council - if you want to use any of these words, you should ask us for advice. If the company is to be registered in Scotland, contact Companies House in Edinburgh.
	institute or institution - approval for use of these words is normally given only to those organisations which are carrying out research at the highest level or to professional bodies of the highest standing.

The following words imply specific objects or functions:

• assurance, assurer, insurance, insurer, re-assurance, re-assurer, re-insurance or re-insurer - if the name is needed for an underwriting company the Companies House will check it.. However, if you want to use the name for a company that will only provide insurance services, then you should include the appropriate qualification, for example 'agents', 'consultants' or 'services', in the name.

• benevolent, foundation or fund - names that include any of these words will be refused if they unjustifiably give the impression that the company has charitable status. If the company is limited by guarantee and has a non-profit distribution clause in the memorandum of association, then the name will normally be approved.

• charter or chartered - names that include these words will be refused if they unjustifiably give the impression that the company has a Royal Charter. If the words are used to qualify a profession, the Companies House seek the advice of the appropriate governing body before considering whether to give approval.

• charity - approval for a name including this word normally depends on the company being registered with the Charity Commission. A company's objects should be charitable and the memorandum should contain a non-profit distribution clause.

• chemist or chemistry - if you want to use these words, you should ask for advice from Companies House in Cardiff. If the company is to be registered in Scotland, contact Companies House in Edinburgh.

• co-operative - if you wish to use this word, your company's Memorandum and Articles of Association should follow the rules generally associated with co-operatives in the UK.

• Friendly Society or Industrial and Provident Society -  if you want to use them in your company name, you should first ask Companies House in Cardiff. If the company is to be registered in Scotland, contact Companies House in Edinburgh.

• group - if use of this word implies several companies under one corporate ownership, then you will need to provide evidence of a parent and/or subsidiary association with two or more other British or overseas companies. If the name clearly shows that the company is to promote the interests of a group of individuals, then the name will normally be approved.

• holding(s) - a company wishing to use this word must be a holding company as defined under section 736 of the Companies Act 1985.

• patent or patentee - a name including either word will only be approved if it does not contravene the Copyright, Designs and Patent Act 1988.

• post office - the Companies House are likely to seek advice on applications that include these words.

• register or registered - the name will not be registered if it unjustifiably implies a connection with HM Government or a local authority. If such a connection actually exists, the name may be allowed if the appropriate body supports the application.

• Sheffield - if you wish to use a name that includes the word 'Sheffield', you will need to establish details of the company's location and its business activities and also consult the Company of Cutlers in Hallamshire.

• stock exchange - names including this expression will normally be refused unless there are special circumstances.

• trade union - names including this expression will normally be refused unless they conform to legislation relating to trade unions.

• trust - the word 'trust' can be used in many different senses.  You should seek the advice of Companies House in Cardiff. If the company is to be registered in Scotland, contact Companies House in Edinburgh.

POSSIBILITY FOR THE DIRECT FORMATION WITH COMPANIES HOUSE
Yes, you can.

Standard registration fee is £20, but the premium service (cost: £50) provides incorporation on the same day as the Companies House receive the formation documents, if they are hand delivered before 3pm. Posted applications cannot be given the same guarantee although, in most cases, the Companies House will register the application on the same day of receipt.
 

There is an additional fee of £15 to be paid to the Regulator when forming a community interest company. Companies House will collect the fee on behalf of the Regulator. Please check on the CICs website at www.cicregulator.gov.uk  for further information regarding fees. Please note that the same day incorporation service will not be available for CICs in the foreseeable future.

For users of the Electronic Filing service, the standard fee is £15 and the premium same-day service is £30. To be able to incorporate electronically, you must either purchase suitable software or develop your own software. Visit the website www.companieshouse.gov.uk for more information.
All company formation documents are subject to certain checks including checks of prospective officers against the Disqualified Directors' Register.

The Registrar then keeps the documents and makes them available for public inspection.

COMPANY DIRECTOR
In general terms anyone can be a company director, but there are some rules. You can't be a company director if:

• you are an undercharged bankrupt or disqualified by a court from holding a directorship, unless given leave to act in respect of a particular company or companies;

• in the case of PLCs or their subsidiaries, you are over 70 years of age or reach 70 years of age while in office, unless you are appointed or re-appointed by resolution of the company in general meeting of which special notice has been given.

There is no minimum age limit in the Companies Act for a director to be appointed in England and Wales. However, he or she must be able to consent to their own appointment. You should seek legal advice if you intend to have a very young person as a director of your company.

In Scotland the Registrar will not register for any company the appointment of a director under the age of 16 years old. A child below that age does not have the legal capacity to accept a directorship - Age of Legal Capacity (Scotland) Act 1991. If you need more information, contact Companies House, Edinburgh.

Some people who are not of British nationality are restricted as to what work they may do while in this country. If you need more information about whether such a person can become a director of a UK-registered company, contact:

Home Office Immigration and Nationality Department
Lunar House
Wellesley Road
Croydon
CR9 2BY   (Tel: 0870 606 7766)

The secretary (or each joint secretary) of a public limited company must also be a person who appears to the directors to have the necessary knowledge and ability to fulfil the functions and who:

1. held the office of secretary or assistant or deputy secretary on 22 December 1980; or

2. for at least three of the five years before their appointment, held the office of secretary of a non-private company; or

3. is a barrister, advocate or solicitor called or admitted in any part of the United Kingdom; or

4. is a person who, by virtue of his or her previous experience or membership of another body, appears to the directors to be capable of discharging the functions of secretary; or

5. is a member of any of the following bodies:
   
   - the Institute of Chartered Accountants in England and Wales;
   - the Institute of Chartered Accountants of Scotland;
   - the Institute of Chartered Accountants in Ireland;
   - the Institute of Chartered Secretaries and Administrators;
   - the Chartered Association of Certified Accountants;
   - the Chartered Institute of Management Accountants (formally known as the Institute of Cost and Management Accountants); or
   - the Chartered Institute of Public Finance and Accountancy.

COMPANY ACCOUNTS
A company's first accounts must start on the day of incorporation. The first financial year must end on the 'accounting reference date' or a date up to seven days either side of this date. Subsequent accounts start on the day following the year-end date of the previous accounts. They end on the next 'accounting reference date' or a date up to seven days either side.

To help you meet this filing requirement, the Companies House send a pre-printed 'shuttle' form to your registered office a few weeks before the anniversary of incorporation. This will show the information that you have already given to the Companies House. If your accounts are delivered late, there is an automatic penalty. This is between £100 and £1,000 for a private company and between £500 and £5,000 for a PLC .

The first accounts of a private company must be delivered:

	within 10 months of the end of the accounting reference period; or
	if the accounting reference period is more than 12 months, within 22 months of the date of incorporation, or three months from the end of the accounting reference period, whichever is longer.

The first accounts of a public company (PLC) must be delivered:

	within seven months of the end of the accounting reference period; or
	if the accounting reference period is more than 12 months, within 19 months of the date of incorporation, or three months from the end of the accounting reference period, whichever is longer.

You may change the accounting reference day by sending Form 225 to the Registrar. You must do this during the accounting period affected by the change or during the period allowed for delivering the associated accounts to the Companies House. For more information, see the booklet, 'Accounts & Accounting Reference Dates'.

ANNUAL RETURNS
Every company must deliver an annual return to Companies House at least once every 12 months. It has 28 days from the date to which the return is made up to do this.

To help you meet this filing requirement, we send a pre-printed 'shuttle' form to your registered office a few weeks before the anniversary of incorporation. This will show the information that you have already given us.

All you have to do is:

	check that the details are still correct;
	amend any that are not; and
	send the form back, signed and dated, within 28 days of the date of the return which is shown on the front of the form.

There is an annual document-processing fee of £30 (or £15 for users of our Electronic Filing or WebFiling services), which must be sent to us with the annual return.

MEMORANDUM OF ASSOCIATION
This document sets out:

• the company's name,

• where the registered office of the company is situated (in England, Wales or Scotland); and

• what it will do (its objects). The object of a company may simply be to carry on business as a general commercial company.

Other clauses to be included in the memorandum depend on the type of company being incorporated. The form of memorandum for each type of company is set out in a set of tables called The Companies (Tables A to F) Regulations, 1985. These tables do not apply to RTM companies or commonhold associations. The memorandum and articles for these types of companies are set out in:

• For RTM companies: ‘The RTM Companies (Memorandum and Articles of Association (England) Regulations 2003’ or ‘The RTM Companies (Memorandum and Articles of Association (Wales) Regulations 2004’

• For commonhold associations: ‘The Commonhold Regulations 2004’.

The company's memorandum delivered to the Registrar must be signed by each subscriber in front of a witness who must attest the signature.

ARTICLES OF ASSOCIATION
This document sets out the rules for the running of the company's internal affairs. Model articles are provided in the Tables mentioned above.

A company may adopt the whole of Table A as its articles or any part of it.

A company limited by shares which has adopted the whole of Table A without modification does not need to deliver a copy for registration. However, you must attach a letter to your application saying this. CICs cannot take advantage of Table A to avoid registering articles.

REGISTERED OFFICE ADDRESS
Company can have postal and registered addresses at once. The importance of the registered address is that all official letters and documentation from the government departments (including Inland Revenue and Companies House) will be send hire and this address have to be shown on all your official company' documentation. The registered office can be anywhere in England and Wales (or Scotland if your company is registered there). The registered office must always be an effective address for delivering documents to the company, and to avoid delays it is important that all correspondence sent to this address is dealt with promptly. If a company changes its registered office address after incorporation, the new address must be notified to Companies House on Form 287.

SHARE CAPITAL
When a company is formed, the person or people forming it decide whether its members' liability will be limited by shares. The memorandum of association (one of the documents by which the company is formed) will state:

	the amount of share capital the company will have; and
	the division of the share capital into shares of a fixed amount.

The members must agree to take some, or all, of the shares when the company is registered. The memorandum of association must show the names of the people who have agreed to take shares and the number of shares each will take. These people are called the subscribers.

There is no maximum to any company's authorised share capital and no minimum share capital for private limited companies. However, a public limited company must have an authorised share capital of at least £50,000.

A company can increase its authorised share capital by passing an ordinary resolution (unless its articles of association require a special or extraordinary resolution). A copy of the resolution - and notice of the increase on Form 123 - must reach Companies House within 15 days of being passed. No fee is payable to Companies House.

A company can decrease its authorised share capital by passing an ordinary resolution to cancel shares which have not been taken or agreed to be taken by any person. Notice of the cancellation, on Form 122, must reach Companies House within one month. No fee is payable to Companies House.

A company may have as many different types of shares as it wishes, all with different conditions attached to them. Generally share types are divided into the following categories:

	Ordinary As the name suggests these are the ordinary shares of the company with no special rights or restrictions. They may be divided into classes of different value.
	Preference These shares normally carry a right that any annual dividends available for distribution will be paid preferentially on these shares before other classes.
	Cumulative preference These shares carry a right that, if the dividend cannot be paid in one year, it will be carried forward to successive years.
	Redeemable These shares are issued with an agreement that the company will buy them back at the option of the company or the shareholder after a certain period, or on a fixed date. A company cannot have redeemable shares only.
	Bearer The holder of a share warrant remains a shareholder but whether they are a member of the company depends on the articles of the company. A company which converts all its shares to share warrants should be careful: it could become a memberless company and therefore cease to exist.

SINGLE MEMBER COMPANY
A single member company is a private company, limited by shares or by guarantee, which is incorporated with one member, or whose membership is reduced to one person but the company must still have at least one director and a secretary who cannot also be the sole director.

Unless the company's articles of association specify anything to the contrary, a single member - present in person or by proxy - constitutes a quorum. If such a meeting is held, it must be recorded within the minutes.

If a single member takes a decision, except by written resolution, then the decision must be given to the company in writing.

If the company enters into an unwritten contract with the sole member who is also a director of the company (and the contract is not in the ordinary course of the company's business), the company must ensure that the terms of the contract are set out in a memorandum or are recorded in the minutes of the next directors' meeting.

A company's register of members must accurately record its members. If a company is incorporated with one member, then the register must reflect this. If the company originally had more than one member and the membership reduces, then the register must show when this happened. Similarly, the appropriate entries must be made in the register of members if the number of members later increases.

RE-REGISTRATION AND CONVERSION OF A COMPANY TO A CIC

1. Both a private company limited by shares and an unlimited company with a share capital may re-register as a PLC, but a company without a share capital cannot do so.
   
   A private company must pass a special resolution that it be so re-registered and deliver a copy of the resolution together with an application form to the Registrar. The resolution must also:

	alter the company's memorandum so that it states that the company is to be a public limited company;
	make any other alterations to the memorandum so that it conforms to that required for a public limited company;
	make any required alterations to the articles of association of the company.

2. A public company limited by shares or by guarantee may re-register as a private company limited by shares or by guarantee by passing a special resolution to do so. However, if enough members object, under section 54 of the Companies Act 1985 they may apply to the court to cancel the resolution within 28 days of its being passed.
   
   A Court may also order a public company to re-register as private on approving a 'minute of reduction' of share capital which results in the issued share capital falling below the statutory minimum. In such a case the Court will also specify alterations to the company's memorandum and articles. A special resolution to re-register is not required.

OVERSEA COMPANIES
The fact that an oversea company is carrying on business in Great Britain does not automatically mean that the company has to register. However, the Companies Act 1985 requires every oversea company which establishes some type of place of business in Great Britain to deliver certain documents to Companies House. A place of business is a premises where there is a physical or visible indication that the company may be contacted there. An oversea company also has to register if it habitually conducts business from a particular location in Great Britain even if there is no physical sign of the company's connection with it.

Registration is not required if there is no physical location in Great Britain. For example, an independent agent who conducts business on behalf of the company is not a place of business of an oversea company; neither is an occasional location such as a hotel where a director may conduct business during periodic visits to this country. Other types of commercial enterprises (for instance partnerships, limited partnerships, unincorporated bodies or government agencies) cannot register in Great Britain as an oversea company.

There are two regimes for registration in Great Britain. These are:

1. a branch; and

2. a place of business.

A 'branch' is part of an oversea limited company organised to conduct business through local representatives in Great Britain rather than referring it abroad.

A 'place of business' is for companies who cannot register as a branch because:

1. they are from within the UK (Northern Ireland or Gibraltar); or

2. they are not limited companies; or

3. their activities in Great Britain are not sufficient to define it as a branch. Such activities might include internal computer processing, warehousing, or simply a representative office.