Issues? look before? establishment of a company? t? UK
There are several issues which need to be considered before starting a company or before setting up a news business. The first and the foremost thing is deciding the name of your new company. Apart from a few restrictions any name is allowed for a company. The restrictions are such that the name should not create a misleading impression to the public. Names like Royal, British, International and Group are generally restricted. Even these names could be used, if the persons willing to use the names, are able to show that they use the names for the good cause. Names which are identical or similar to the name of an existing company cannot be used.
Once the name of the company is selected, the persons must concentrate on the objects of the company. They must focus on what must be included in the Memorandum of Association and Articles of Association, which allows the company to engage in any legal business activity effectively. Then, choose a date for incorporation and complete all the preliminary works before that date. If you purchase a readymade company, then you need to convince yourself with regard to outstanding liabilities that the company might have. Legal advisers could be used to ensure that any indemnities and promises assured towards the company are adequate.
For setting up a business, one needs to design a business plan. Though many people wish to become an entrepreneur, they do not have a proper idea of what to do and how to do. For the prospective businessmen, there are various options - buying a franchise or existing business, or starting a new business. The less complicated form of business is the sole proprietorship. In this type, the business and the individual are considered as one and the same. This is the simplest and the cheapest form of business. As people work on their own, they are eligible for the entire income and liable for all debts. They have a complete control over their business. If you want to start as a sole proprietorship business, then, you need not notify to Companies House, nor deal with any administrative requirements which are essential for starting Limited Companies. As a sole trader, you must register with the Inland Revenue even if you have already sent in a tax return.
The next form of business is the partnership. No one has the entire skills which are required for a business. One may be good at sales, one at accounts and others in some other thing. Therefore, it is a better idea to mix all these qualities for running a business. When you start a business with others, there is a possibility to use others¡¯ talents as well. In this type of business, you are liable for the debts in proportion to how much of it is yours and your income may be of the same proportion.
Apart from this, in the UK, there are three major types of companies, viz., companies limited by guarantee, limited by share capital and unlimited companies. Of the three, the most popular is the company limited by shares. Public company can be either limited by guarantee or limited by shares. These companies can sell their shares to the public as well as opt for a public listing on one of the recognised exchanges. These are susceptible to more restrictions by law, especially when it opts for public listing.
Private companies are those companies which are not Public Limited Companies. They have less stringent rules and regulations requirements with regard to share capital, qualifications of the company secretary and the number of directors. Those companies which are limited by guarantee are not allowed to have word ¡®limited¡¯ at the end of their name where as the companies limited by shares must have the word ¡®limited¡¯ at the end of their name as per the Companies Act.
Unlimited companies are not most popular among the people setting up a company. The absence of limited liability makes this kind the most unappealing or unappetising to the prospective entrepreneurs. As the chances for sheltering personal assets from the company's creditors are not available with an unlimited company, most of the entrepreneurs do not opt for this type.
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