Formation of a company Flashcards

Question

What tax registrations will a new company need to register for?

Answer 1

-Corporation tax -VAT -PAYE -National Insurance (if it has employees)

Answer 2

It is not a legal person and therefore has no capacity to enter into contracts.

Answer 3

S51 CA 2006 seeks to protect third parties who believe they are entering into a contract with a company which is incorporated and registered by making pre-incorporation contracts enforceable as personal contracts against the persons purporting to act on the company’s behalf.

Answer 4

By passing Board Resolutions at Board Meetings.

Answer 5

Each director has one vote. Board Resolutions are passed by simple majority (MA7) unless the directors have agreed that a particular decisions requires unanimity (MA 8).

Answer 6

Via written Board Resolution which means the directors don't have to waste time attending Board Meetings.

Answer 7

By passing Shareholder Resolutions either at a GM (General Meeting) or in writing (for private companies only under s288 CA 2006).

Answer 8

-Ordinary Resolutions which are passed by a simple majority (over 50% of the votes) -Special Resolutions which are passed by a majority of 75% or more of the votes

Answer 9

-Via a show of hands -On a poll

Answer 10

When the shareholders vote on a show of hands, each shareholder who is present at the meeting will be entitled to one vote regardless of the number of shares held by that shareholder (s284(2)

Answer 11

When the shareholders vote on a poll, every shareholder has one vote in respect of each share held by them (s284(3))

Answer 12

This section sets out that a poll resolution can be demanded either in advance of the GM where the vote will take place, or at a GM either before a show of hands on that resolution or immediately after the result of that vote.

Answer 13

-chairperson of the meeting -directors -two or more persons having the right to vote on the resolution -a person or persons representing at least 10% of the total voting rights of all the shareholders entitled to vote on the resolution

Answer 14

Under s281 CA 2006 only private companies may pass a shareholders resolution by way of a written resolution.

Answer 15

S284(1) states that, where a company has a share capital, every member has one vote in respect of each share held by them when voting on a written resolution.

Answer 16

-written ordinary resolution-passed by a simple majority of the total voting rights of eligible members (s282(2) CA 2006) -written special resolution-must state that it is a special resolution and passed by a majority of members not less than 75% of the total voting rights of eligible members (ss283(2) and (3) CA 2006).

Answer 17

-Removal of a director (s168 CA 2006) -Removal of an auditor (s510 CA 2006)

Answer 18

-MA 9 provides that any director may call a BM or require the company secretary to do so at any time -Reasonable notice of the BM is necessary, whatever notice is usual for the directors to give -Minimum number of two directors must be present (MA11 (2)) -Majority vote on a show of hands (MA7(1)). Each director has one vote and the chair may have a casting vote to prevent deadlock.

Answer 19

-The Board will usually convene a GM -14 days clear notice is required for private companies (the day of the meeting and notice are both excluded). S1147 CA 2006 provides that if posted or emailed, the notice is deemed served 48 hours after sending. -Two shareholders must be present although one shareholder for single member companies -Via a show of hands or a poll vote

Answer 20

BM1-to decide on the issues to be considered at the GM, to approve the form of notice for the GM and to circulate it. GM-held at least 14 clear days from BM1, the shareholders will vote on the resolutions set out in the notice. BM2-a further BM will be held and the directors will be informed of the shareholders vote and whether the resolutions were passed. Post-Meeting Matters (PMMs)-copies of the relevant documents filed at Companies House and company's internal records updated.

Answer 21

S307(5) CA 2006 provides that, for a private company, a GM may be called on short notice if this is agreed to by: -a majority in numbers of the members who, -together hold shares with a nominal value of not less than 90% of the total nominal value of the shares which give the right to attend and vote at the GM.

Answer 22

BM1-to convene the GM, approve the form of notice and circulate the notice. The BM is then adjourned. GM-takes place immediately following the adjournment of the BM and the shareholders vote on the resolutions. BM2-is reconvened and the directors are informed as to how the shareholders voted and authorize relevant action. PMMs then carried out.

Answer 23

Can be proposed by the directors or the members of a private company and is passed when the required majority is passed.

Answer 24

It will lapse. For a company with MA, the lapse date is 28 days beginning with the circulation date.

Answer 25

BM-to propose the use of the WR procedure and to approve the form and circulate the WR. BM adjourned- approval of the WR takes place immediately after. BM reconvened-to inform the Board how the shareholders voted. PMMs are then carried out.

Answer 26

BM-to propose the use of the WR procedure and to approve the form and circulate the WR. BM closed-the WR is passed once it receives the required level of support (or lapses after 28 days for an MA company). BM2-to inform the Board how the shareholders voted. PMMs are then carried out.