Types of business

Question 1

Partnership definition

Answer 1

When 2/more people “carry on business in common with a view of profit” (so, can arise impliedly)

Question 2

Ground for piercing the veil

Answer 2

If a controller is using a company to evade an existing legal obligation

Question 3

To incorporate a private company, must submit to Companies House:

Answer 3

1. form IN01
2. memorandum of association
3. Articles of Association (unless using Model)
4. applicable fee

Question 4

Registering for tax on incorporation of private company

Answer 4

If applied online: automatically registered with HMRC
If by post/software: must register separately within 3 months of starting business

Question 5

Restrictions on company names

Answer 5

• if using it would be criminal offence/offensive,
• approval of Sec. of State needed if name suggests link with government, or sensitive word used (eg. university),
• max. 160 characters,
• will be rejected if: intended to facilitate fraud, contains computer code, falsely indicates link to foreign government/organisation

Companies House can require change of name- must do so within 28 days!

Question 6

Number of directors required

Answer 6

Min. 1 if private company, min. 2 if public (min. 1 must always be natural person over 16)

Question 7

Statement of capital in IN01 form includes:

Answer 7

• number of shares of each type + total nominal value,
• names + addresses of shareholders
• “prescribed particulars” of shares: share of dividends received, if chan be exchanged for money, whether voting + how many votes

Question 8

Company’s constitution consists of:

Answer 8

1. Articles
2. Certificate of incorporation
3. Memorandum of association

Question 9

How to amend Articles

Answer 9

Special resolution

Then, file copy of Articles + special resolution with Companies House within 15 days of new Articles taking effect

Question 10

Who is a person with “significant control”?

Answer 10

• holds over 25% of shares
• holds over 25% of voting rights
• can appoint/remove majority of board of directors

Question 11

How to convert to public company

Answer 11

Pass special resolution, change name to “plc”, amend Articles

Then, file at Companies House:
- special resolution
- application for re-registration
- fee
- revised Articles
- balance sheet + written statement from auditors