Companies can be formed very easily in as little as three hours online, but there are certain requirements that need to be met in order for the company to operate properly. Most of these requirements are to stop you falling foul of Her Majesties Revenue and Customs (HMRC). It may seem like there is a mountain of things to get right in order for your company to function within the limits of the law, but the most important thing with any company is to generate business. After that has been taken care of, everything else is a lot easier.
The Basic Formation Process
You can do this yourself by contacting Companies House and filling in forms and this is quite easy if you know what you are doing. You will still need to make a payment in order to register your business, so the recommended way is to use an online formation agent. Your company is generally set-up within three hours of the completion of the process, which usually takes around ten minutes. It is actually cheaper to use a formation agent than it is to register directly with Companies House. Although this sounds implausible, formation agents usually benefit in the long term my selling essential services that every businesses use. In most cases, using a formation agent is much easier than a DIY option.
What Do You Need to Know?
All you need to know when forming a company is who you are naming as the directors are and the address of the registered office. In many cases, the registered office can be your home if you are starting a small company. This will save on the cost of using a registered office, although your home address will be on public record and liable to receive heaps of business mail from everyone and anyone who is trying to sell you something.
The First Steps when the Company is Formed
The first thing every company needs to do is appoint an accountant. They can handle everything that is required by HMRC and they will prevent any problems arising later. If your company is to operate a PAYE scheme or you are going to register your company for VAT, an accountant can handle all of this for you. You do not necessarily need to register for VAT initially, but if you expect to have a turnover of more than £77,000 in a financial year. You do not need to do this immediately, unless you expect to hit the £77,000 threshold in the first 30 days. Your appointed accountant will handle all your necessary requirements with the HMRC and as a limited company; it is a requirement to have your accounts filed using Generally Accepted Accounting Principles (GAAP).
If you are thinking about forming a limited company, partnership or thinking about going in to business in any form in the UK you should seek professional advice about company formation or use a walk-through online.