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Company Formation - High 5 Things to Avoid When Setting Up a Restricted Firm

by Amelia Eusebio (2020-01-30)

1) Avoid choosing an organization name that's likely to be rejected or will have to be changed later.

There are guidelines when picking a name on your new restricted company. Certain words are deemed to be delicate and the place a company wishes to use such a word of their firm name, they might have to provide supporting documentation. Otherwise the application could also be rejected.

You may check the list of sensitive words on the Firms House website or your formation agent must be able to highlight the restrictions for you.

2) Keep away from making errors with addresses.

When registering your limited firm you will be requested to provide a number of addresses, including the registered office address of the company and for each director, their ordinary residential address and a service address.

You have to be additional careful to ensure these are appropriate as it can be expensive to get this corrected. Many firms choose their accountant or formation agent as their registered office so you will need to make sure this is also correct.

three) Avoid purchasing an off the shelf company.

An "Off the Shelf" firm was a really useful option to take when wanting to start out a company shortly, mainly before the age of internet filing. Since company formation agents can now fill within the application for you online they can usually have the corporate fashioned for you within 24 hours. This signifies that the main benefit of off the shelf corporations not exists. Importantly, by forming your own new limited firm you also avoid the risk of buying a company from folks you don't know, as you can be responsible for the previous history of the company.

four) Avoid beginning out with out a marketing strategy or a Chartered Accountant for support.

A marketing strategy will aid you to plan out the progress of what you are promoting, the resources you will need and any potential areas of difficulty. After you've gotten shaped your organization it is going to be a lot easier to see the place your enterprise is heading and what must be modified within it for those who already have a marketing strategy in place.

An experienced Chartered Accountant can also be very useful when starting up. They are going to be able to advise you about whether you'll want to register for VAT or PAYE and can help you with forms despatched by Firms House and HM Income & Customs. Most significantly they will be able that can assist you prepare your annual accounts and be certain that they're filed on time.

5) Keep away from forming your company in a rush.

It could appear obvious, but there are numerous vital selections to make when forming a limited company they usually should not be made lightly. You must at all times ensure that you're taking your time, both when deciding whether organising an organization is right for you as well as when actually finishing the application process.

In addition, company directors and the company secretary may have authorized obligations and people must be aware of these responsibilities earlier than agreeing to take on these roles.

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