On the surface of it very little is involved in running a Limited Company.
A limited company can be set up for under ?30, complete with Memorandum of Association and Articles of Association.
As standard procedure Ltd Companies are created with 100 shares of a nominal value of ?1 each.
A Director and a Company Secretary need to be appointed (which can be the same person!)
The company is not legally required to trade, but is legally obliged to complete certain tax forms annually (or else a fine will be imposed). Each year the company must complete an 'Annual Return' which is basically a form that confirms the Registered Office address, names the shareholders, directors and company secretary or amends any changes that have occurred through the year.
A fee of ?15 - ?30 is payable (depending whether you file online or not) annually with your Annual Return.
Additionally your accounts must be submitted to your local tax office each year (even if you have not traded) along with a cheque for any Corporaion Tax due on profits.
Finally you need to submit a CT600, a complicated looking form, but quite straight forward to fill in once you have mastered it. The form (again annual) breaks down the elements of income that your company has received and provides the basis of how you have worked out your tax liabilities.
I am more than happy to help people with the basics of a CT600, but if your affairs are complicated, I would strongly advise employing an accountant.
And that is it! In a later post I will explain the duties of Directors and Company Secretaries and some odd quirks. But for now, please do feel free to ask any questions or add comments.
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there a cost involved to the owner of the company?
Yes and no. "The Owner" of an ltd or plc is anyone who owns a share. Its called Equity. Owning even 1 of the 100 shares amkes you a part owner of the business. So if one man, lets just call him Ben, started an Ltd as a budding young businessman, but then kept all the shares himself, selling shares would be a way of raising income for the business. So the business gains and therefore so does the owner. But, the original owner loses some of his holding in the business and also has to consult shareholders on decisions