The following text is a concise summary of the legal and bureaucratic issues an entrepreneur needs to overcome in order to incorporate and gain registration for a new firm in the United Kingdom. It looks at the steps involved in setting up a commercial business or industrial firm with up to 50 employees and start-up capital of 10 times the economy’s per-capital gross national income (GNI).
1. Check name for uniqueness at the company names index database on the web
This can be done at http://wck2.companieshouse.gov.uk/b2366611298171d46dc7fbf07eee4e08/wcframe?name=accessCompanyInfo
2. Prepare memorandum and articles of association; fill out and sign Form IN01 (application for registration).
The wording needed for the memorandum outlined in the Companies (Registration) Regulations 2008 (SI No. 2008/3014), and model articles are outlined in the Companies (Model Articles) Regulations 2008 (SI No. 3229). This can be bought from legal stationers, solicitors, accountants, or company formation agents. Forms can be accessed for free from the Companies House website: www.companieshouse.gov,uk. The company limited by shares that has adopted model articles without changing is not required to provide a copy for registration. Form IN01 requires signatures from all of the subscribers. In addition to the memorandum and articles of association, company registration applications need to include the following information on the form IN01 which should be filed with the relevant Registrar of Companies (i.e. for England and Wales (or Wales), Scotland or Northern Ireland):
3. File incorporation documents with the Registrar of Companies at Companies House
The charges for filing incorporation documents can differ. The standard registration charge is GBP 20 and GBP 50 for same day incorporation, and online registration is GBP 15 and GBP 30 for same day incorporation.
4. Contact HMRC and register for VAT
The company will be contacted by HMRC so that registration for corporate tax can be undertaken (tax on company profits).
5. Contact HMRC and register for PAYE
The company must contact the Inland Revenue separately to start a contribution scheme for national insurance and pay-as-you-earn (PAYE) tax, which deducts income tax from employee wages or salary). In approximately a week, they will be provideded with an activation PIN and are required to activate this within 28 days (or else request a new PIN).
6. Sign up for employer’s liability insurance
In accordance with the Employers’ Liability (Compulsory Insurance) Act 1969, proof of insurance needs to be posted at the workplace. This information can be displayed electronically, as of 1 October 2008,. Any company that wishes to do this are required to ensure that employees know how and where to allocate the certificate and have reasonable access to it, when needed.