Business - Business Mediums Flashcards
What form must be completed to form a company?
Companies House form IN01
This form is essential for the incorporation process.
What happens if the requirements of the CA 2006 are met?
The company is incorporated and a certificate of incorporation is issued
The company comes into existence upon the issuance of this certificate.
What are the required elements on the Form IN01?
- Company Name
- Required Ending
- Registered Office
- Email address
- First directors
- Directors’ residential and service addresses
- Company Secretary (if applicable)
- First shareholder(s)
- Statement of capital
- Company’s constitution
- People with significant control
Significant control refers to individuals holding more than 25% of shares or voting rights.
What are the options for adopting Model Articles?
- Adopt in entirety without filing
- Adopt with amendments
- Supply entirely bespoke articles
Companies can choose how to incorporate the Model Articles based on their needs.
What is required for shareholders to amend the articles?
A special resolution passed by at least 75% of the shareholders
This is governed by section 283(1) CA 2006.
What must a company do to convert to a Plc?
- Pass a special resolution for re-registration
- Alter the company’s name to include ‘plc’
- Alter the articles to be suitable for a public company
This process is outlined under s90(1)(a) CA 2006.
Ownership and Management Requirements of LLPs
- Owners : At least 2 designated members for LLP
- Managers : At least 2 designated members for LLP
This ensures proper representation in ownership.
Ownership and Management Requirements of General Partnerships
- Owners : At least 2 partners for general partnerships
- Managers : At least 2 partners for general partnerships
This ensures proper representation in ownership.
Ownership and Management Requirements of Private Companies
- Owners : At least 1 shareholder for LTD
- Managers : At least 1 director for LTD
This ensures proper representation in ownership.
Ownership and Management Requirements of Public Companies
- Owners : At least 1 shareholder for LTD and PLC.
- Managers : At least 2 directors and PLC.
- Secretary: Must have 1
This ensures proper representation in ownership.
Who must be audited?
Partnerships and companies, other than sole traders
Auditors owe a duty to the company, not directly to directors or shareholders.
What types of security exist for partnerships and companies?
- Fixed for sole traders and general partnerships
- Fixed and floating charges for others (LLPs, Plcs, Ltds)
These securities are used to secure financing and obligations.
What tax obligations do PLC and LTD companies have?
Corporation tax and other income tax
These obligations ensure compliance with tax regulations.
What transparency requirements do LLPs have compared to general partnerships?
LLPs must notify the Registrar of Companies whenever a member joins or leaves
This is a significant requirement for maintaining transparency in ownership.
What are incorporated companies
Public and private limited companies and
LLPs
What are unincorporated companies
Sole traders, general partnerships, and limited partnerships.
Sole Traders (Formation Formalities and Administration) requirements
Formalities: No Formalities. The owner simply operates the business
Administration: No legal requirement to keep records or publish accounts
Sole Traders (Tax) Requirements
Sole trader pays income tax and CGT.
Sole Traders - Liability
Unlimited personal liability for the obligations of the business.
General Partnerships (Formation Formalities and Administration) requirements
Formalities: No formalities required - Formed when 2 or more person’s (could be business entities) carry on business in common with the intention to make a profit
*Desirable to have a formal partnership agreement as
otherwise the Partnership Act 1890 provisions will apply
Administration: There is no legal requirement to keep records or publish accounts.
General Partnerships (Tax) Requirements
Partners pay income tax
General Partnerships - Liability
Unlimited personal liability for the obligations of the partnership, jointly and severally
LLPs (Formation Formalities and Administration) requirements
Formalities: Formed by sending form LLIN01 to Companies House and receive a Certificate of Registration.
Administration: required to register the partnership for self-assessment with HMRC. No companies house requirements.
LLPs (Tax) Requirements
Partners pay income tax
