ChatterBank3 mins ago
Limited Company Formation
4 Answers
I want to start a limited company and there are loads o companies online that will do this for me, all offering different things and at different prices, does it matter which package I choose when it comes to getting a loan from a bank, and what should I look out for?
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Let's start with the banks. They'll lend on the same basis that they'd lend to you, as a private individual, but with more reservations. Ultimately you are not liable for the debts of the company.If the company ceased trading or did not pay its bills or went bust you'd not be personally liable.That makes banks careful ! So they lend according to the trading record and the assets of the company, which they may put a charge on or require as security, and may ask you, as a director, to personally guarantee loans they make to the company lest the company defaults.
The company formation agents in England offer various services.The basic 'package' would be a ready made company, 'off the shelf', ready to go.That's fine.A snag is that you may not like the weird name it has been given. The agents have to invent lots of names to avoid using a name of an existing company.You could change it later but people who buy these usually trade under a trading name, not the company's registered name (which appears in small print on its invoices etc, as the law requires)
The agents offer a more personal service too.They'll let you choose a name for the company and register that at the outset, subject to Companies House rules.If you want they'll use a more relevant Memorandum (basically what it intends to do and what type of trade or business it can be involved in) or change the standard articles (the rules of the company) to suit particular needs. (They otherwise use a generally worded memorandum and standard articles)
Or they'll simply do all the paperwork for you from scratch, you telling them what you want, and go on to form a company just for you.The companies they have ready made will have one of their employees notionally named as one of the promoters,just for technical reasons If you use the most personal service even that name won't appear.
The banks won't care which service you use.
The company formation agents in England offer various services.The basic 'package' would be a ready made company, 'off the shelf', ready to go.That's fine.A snag is that you may not like the weird name it has been given. The agents have to invent lots of names to avoid using a name of an existing company.You could change it later but people who buy these usually trade under a trading name, not the company's registered name (which appears in small print on its invoices etc, as the law requires)
The agents offer a more personal service too.They'll let you choose a name for the company and register that at the outset, subject to Companies House rules.If you want they'll use a more relevant Memorandum (basically what it intends to do and what type of trade or business it can be involved in) or change the standard articles (the rules of the company) to suit particular needs. (They otherwise use a generally worded memorandum and standard articles)
Or they'll simply do all the paperwork for you from scratch, you telling them what you want, and go on to form a company just for you.The companies they have ready made will have one of their employees notionally named as one of the promoters,just for technical reasons If you use the most personal service even that name won't appear.
The banks won't care which service you use.
Do it yourself.
1. Download Form 10 and 12 from companies house for free and complete form 10
2. Create (or buy from Staples) the Memorandum and Articles of Associatiion
3 Complete the Mems an Arts, if unsure what they mean, ask Business Link for advice, that's free
4. Take form 12 to a solicitor to witness your Signature - should cost you less than a tenner.
5. Send it all to Companies house with a �20 cheque.
1. Download Form 10 and 12 from companies house for free and complete form 10
2. Create (or buy from Staples) the Memorandum and Articles of Associatiion
3 Complete the Mems an Arts, if unsure what they mean, ask Business Link for advice, that's free
4. Take form 12 to a solicitor to witness your Signature - should cost you less than a tenner.
5. Send it all to Companies house with a �20 cheque.
I agree with markandshez. Do it yourself.There is plenty of info on the net.Get a free info brochure from Companies House. And you can buy all the necessary forms in a pack from WH Smith etc. Then find a company secretary (wife/brother/friend etc), visit a solicitor to get forms signed, and post to Companies House. Easy! Getting the loan might be more difficult!
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