Benefits And Deficits Of A Cheap UK Company Formation
Well, the obvious benefit of getting your company set up cheaply is price. If you do the job yourself at Companies House, you'll get it at a rock bottom rate!
The setup will be quick and you can do it at your leisure.
The down side is that you may make errors which can be troublesome to correct later. A common one is getting a director's date of birth wrong. This can only be fixed by removing that person as director and then re-registering them again.
Another mistake is getting the shareholding wrong. It's not a good idea to give yourself 1,000,000 shares at £1 ea. as this has to be accounted for in the company's annual returns. It is also the sum that shareholders are liable to pay if there are debts registered against the company!
Many people don't realise that the shareholders are the actual owners of the company. Whoever owns 51% of the shares has control of the company, but, the other guy, with 49%, owns 49% of the company, including its assets and any dividends. This can lead to problems later if one person is lazy and doesn't contribute to the success of the company. It leads to resentment from the other shareholder(s) but legally there's nothing they can do: Mr. Lazy has his rights.
Another common error is going super-cheap and not buying the right to use someone else's address as the Director's Service Address (Director's Correspondence Address). This is the public mailing address of the director as a person. It's on the public record and ends up in other online databases. Some people aren't bothered about this, but some are.
Most new companies registered in Britain are companies limited by shares (LTDs). This is the most common entity created when one or more persons want to establish a business separate from themselves as persons with the purpose of generating income and financial profit for the owners of the business.
It allows for profits to be shared amongst shareholders while also giving limited liability to them in the event of charges or lawsuits brought against the company. It protects their personal assets.
So one needs to think about what one is doing in setting up a company. Our staff have some experience of this, and can help.
Get your cheap company formation through us and relax in the knowledge that you have the backup of an experienced service provider that can advise you beforehand and help correct mistakes later. We have set up of an online formation process which takes the strain out of setting up a company and lets you get it up and running ASAP.
- Cheap company formation;
- Registered Office address;
- Electronic Certificate Of Incorporation;
- Electronic copy of Memorandum & Articles of Association;
- Electronic share certificate;
- PDF format.
Go here to form your company: http://www.registeredaddress.co.uk/company-formation
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