Company House Registration

[Andrew L]

Good Morning,

Trying to register as a new company with Company House.

 

Got stuck with the CIS but discovered we are "landscape gardeners" by looking up another firm I knew about ;).

 

Can anyone explain the ramifications of "shares"?

Does it make any difference what type of shares I have at this stage (sole trader moving to Ltd company)?

How many shares should I declare?

What value?

How do I know?

 

I would be very grateful for any advice

Andrew

[Ian C]

Just get an accountant to sort it, you will need one anyway

[Inoff the Red]

A limited company is a separate legal entity and is owned by the shareholders.

How many shares a company issues and the nominal value of those shares is open to the company. You only need issue 1 share with a nominal value of £1 if you wish. 

The thing to recognise is that share capital is effectively tied into the company. There are ways of getting the money invested in the shares back but it is more complicated than putting money into the business by way of directors/shareholders loan. 

 

You could issue 1 share with a nominal value of £0.01 but anyone seeing the company's accounts may not be impressed. Companies bought off the shelf used to have an initial share capital of 100 shares of £1 each, but the number and nominal share value is up to you.

  

If you are transferring your sole trader business into a limited company you need to think about the value of the business and its assets that you are transferring into the company. 

Another consideration if married, is whether you allocate shares to your other half which could be tax advantageous especially if they are not working.

You should seek the advice of an accountant because switching from sole trader to operating through a limited company involves numerous changes, new bank account, new CIS registration, paye registration if you have employees, etc etc

 

 

Edited January 27, 2019 by Inoff the Red

[Andrew L]

Thank you (all) for your advice and apologies for tardiness in my acknowledgement.

Went for an off-the-shelf registration in the end which was a) much easier than companies house and b) cheaper ??!!

 

[Steve Bullman]

You won't regret going limited, specially if your accountant is on the ball. My tax bill dropped by over 60% this last year

[Mark J]

4 minutes ago, Steve Bullman said:

You won't regret going limited, specially if your accountant is on the ball. My tax bill dropped by over 60% this last year

That will be because you're paying yourself a smaller salary.

[Steve Bullman]

Thats one of the primary reasons, but theres a lot more to it than that

[donnk]

shares can be allocated to other family members as well so they can receive a dividend. Especially if the mrs doesnt work.

[Mark Bolam]

Of course she works donnk.

She’s the ‘company secretary’.

[donnk]

cant pay the secretary divvies though !