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How To Register As A Limited Company For £31.26
A Guide In Seven Steps
This guide is only for a Private Company limited by shares - where members’ liability is limited to the amount unpaid on shares they hold (ie most production companies).
If you are interested in or are considering setting up as as sole trader, partnership, private company limited by guarantee (where members’ liability is limited to the amount they agree to contribute to the company’s assets if wound up), private unlimited company (where there is no limit on members’ liability) or a public limited company (PLC), then check a guide such as the Lloyd’s TSB Small Business Guide, which you can often wrangle for free if you say you’re interested in opening a business account with them.
This guide is not intended for legal use, check with a Solicitor, Accountant or Company’s House if you are unsure about anything. We cannot be held liable for inaccurately filled out forms, misapplications or otherwise.
Now you could pay a solicitor to do it for you for around £100, or you could follow this guide and register for just... £31.26 (including postage stamp).
1) Check that the name of your company is available by ringing Company’s House. Decide upon company directors, registered offices and appoint a company secretary.
2) Download Form 10 and Form 12 from the company house website. Download form 10cs if you have more than two directors.
3) Fill in forms on your computer and print out. Get the company directors and secretary to sign Form 10 (and 10cs if necessary).
4) Find your nearest legal stationary shop by calling Scoot or Oyez. Buy a copy of Memorandums and Articles for company formation for about £6.
5) Fill in the Memorandums and Articles and get all directors and the company secretary to sign it with a witness (the witness can be anyone).
6) Take Form 12 to a solicitor and sign it in front of them. Get their signature on the form. Most solicitors charge £5 per signature.
7) Post Form 10, Form 10cs (if used), Form 12 and the Memorandum and Articles with a cheque for £20 to Companies House. This is supposed to take 5-6 working days to process upon receipt, and you can pay £100 for same-day registration if you’re in a rush.
And that’s it.
1) Ring company’s house to check the availability of your name. There are restriction on which names can be used, if in doubt ask to receive the Company’s House guide ‘Company Names’ which can be ordered through the website - http://www.companieshouse.gov.uk or by telephoning 0870 3333636. Other Company House guides worth getting include:
Company Formation - code GBF1
Company Names - code GBF2
Business Names - code GBF3
Directories and Secretaries Guide - code GBA1
Annual Return - code GBA2
Accounts and Accoutn reference Dates - code GBA3
Auditors - code GBA4
Late Filing Penalties - GBA5
Share Capital and Prospectuses - GBA6
Resolutions - GBA7
There are responsibilities for both the directors and company secretary, so choose these roles carefully, as failing to keep Companies House up to date can leave you open for hefty fines or even imprisonment.
The work of the Company’s Secretary is more than it first appears, so I recommend getting hold of a book such as the Company Secretary’s Handbook ( Helen Ashton, pub. Kogan Page, 1995, ISBN 0749426462, cc £12.99).
Choosing a registered office means you have to display a visible sign saying it is the visible office for the company, so if it is your residential address check with your landlord/lady first.
2) You can download Forms 10 and 12 from the Companies House website at http://www.companieshouse.gov.uk. You can also request the forms from them by telephoning 029 2038 0801.
Form 10 only has room for two directors on it so you will also need Form 10cs if you have more directors than that. The Company Secretary can also be a director if there is more than one director. Although a Company can have just one director, that person cannot also be the Secretary.
3) By downloading the forms you can fill them in on your computer (they’re in Adobe Acrobat PDF format). Download the necessary translator from adobe’s website (www.adobe.com) if your computer is too old to have it pre-installed.
Filling in the forms is relatively straightforward, but if you have problems/questions, phone Companies House on 029 2038 0018 for England and Wales, and 0131 535 8831 for companies registering in Scotland.
Get all the directors and secretary to sign the forms, declaring any other directorships. DO NOT SIGN FORM 12! (yet)
4) Memorandums and Articles of Association (which are two different documents, usually stapled together) are available from legal stationers, accountants, solicitors or company formation agents. You can get them cheaply from Oyez (usually around £6 for them both). You can also get Forms 10 and 12 from these places (but you might as well get them from Companies House for free). To find the nearest Oyez to you, phone 0870 7377370. Alternatively call Scoot on 0800 192192 to find other legal stationers in your area.
5) Fill in the Memorandums and Articles of Association.
This is probably the trickiest part. Basically I’d recommend reading it through fully once, and then fill it in as you read it through again. Remember to add the company name to the front of both the Memorandum and the Articles, and at the top of the first page of both. It’s easy to skim the forms looking for gaps, and miss things to fill in. The three main areas which might be confusing are the Objects, the Share Capital and the General Authority. So, in more depth:
The Company’s Objects (on the first page of the Memorandum of Association)
I was once told that this should be broad enough so you aren’t prevented from doing lots of different things, and specific enough to stop you getting into trouble if the company is taken over or bought out. Often when a company is sold or bought out, a bar is placed on the Company’s directors, preventing them from doing what is stated in that company’s objectives for another company for certain period of time (say 5 years). For example, Richard Branson was barred from setting up another record company after he sold Virgin for 18 months (or thereabouts). So to avoid spending the next few years of your life unable to set up another company, don’t make the Objects too broad. Of course most film production companies won’t ever consider being bought out (and the directors probably wouldn’t leave it was), but it’s worth baring in mind. An object such as ‘to develop and produce film and video projects’ would probably suffice.
Share Capital (section 5 of Memorandum of Association, and section 4 of Articles of Association)
This is the unpaid share capital that the directors agree to pay in the event of the company being wound up. It can be any figure, any number of shares, and value of shares as long as they are whole numbers and add up. Most solicitors recommend a capital of £10 or £100, although this figure does not divide into three equal parts, so if there are three company directors it is not ideal.
A figure such as £24 divided into 240 shares of £0.10 each, or £60 divided into 300 shares of £0.20 each would allow your share capital to be divided equally between 2, 3, 4, 5, 6, 8 or 10 directors. This sort of figure is also useful as it allows you to add or remove directors at a later date, and redistribute their share capital.
Of course the amount of share capital taken by each director does not need to be the same.
On page 1 of the Articles of Association it usually states that the company capital is £x___ divided into x number of ordinary shares of £1 each. If your shares are other than £1 each, cross this figure out and and write beneath the actual value per share.
General Authority (section 5 of Articles of Association)
This is a date no more than 5 years after the date of incorporation. As you don’t know the date you’ll be incorporated, put the date of when you’re filling in the form plus five years. So on March 23rd 2000, you'd put down March 23rd 2005.
Many Memorandums and Articles still have a ‘19__’ for you to fill the year in - just cross this out and put the full year in.
Each director must sign the end of the Articles and the Memorandum in front of someone. No stipulation is made as to who this should be, but a bank manager is a safe bet. There’s no reason why it couldn’t be your flatmate, though. As well as signing, each director should put their name and address. It might be worthwhile to add the address of the witness beneath their signature, although this is in no way obligatory.
6) Get a solicitor to sign form 12
The last form to complete is Form 12, and should be signed in front of a Commissioner for Oaths or Notary Public or Justice of the Peace or solicitor. The easiest option is obviously the solicitor, who will typically charge £5 for one signature. Again try Scoot (0800 192192) to find you nearest (and cheapest) solicitor, if needs be.
7) Post it!
OK, collate Forms 10, 12, 10cs, the Memorandums and Articles of Association, and your cheque. It might also be wise to include a covering letter, with everything paper clipped to it, although this is not obligatory.
Make the cheque payable to Companies House and should either be for the standard registration fee of £20, or the same day service (if received before 3pm that day) for £100.
Mark the envelope with ‘for the attention of New Companies Section’, and if you are doing same day registration, also write on the envelope ‘same-day incorporation’. It’s advisable to put your address on the back of the envelope.
If you wish to receive acknowledgment of receipt of the forms enclose a stamped addressed envelope, although Companies House will send you your Certificate of Incorporation as soon as your registered anyway.
Send it to:
For Companies incorporated in Scotland:
The Registrar of Companies
37 Castle Terrace
For companies incorporated in England and Wales:
The Registrar of Companies
CARDIFF CF14 3UZ
Congratulations, you are now the director of a company, and are allowed to ‘erect, construct... roads, railways, tramways, bridges, reservoirs, factories… plant and machinery necessary or convenient for the Company’s business’. Cool.
The article is reproduced by kind permission of Nic Wistreich of Shooting People and appears in the book 'Get Your Film Funded - available from http://shootingpeople.org/funding
As an alternative you may wish to consider the Limited Company Kit from LawPack This has all of the forms mentioned above and at £9.99 should be considerably cheaper than bauying from OyezStracher.
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