Key tax dates and deadlines for 2018/19
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By Lynne Gowers on 16th February 2018
If you are in the process of setting up a limited company or you are already the owner of an incorporated business, you’ve probably come across the (somewhat grandiose) term “Memorandum and Articles of Association”. But what exactly are these documents and why do you need them when you start a new business?
In short, a limited company’s Memorandum of Association contains the names of all the subscribers; these are the people who were there when the company was founded, such as the initial shareholders. The Articles of Association are basically a set of guidelines on how the company is to be managed.
Every limited company must have a Memorandum of Association in place, it comes in a standard Companies House format and confirms every shareholder’s intention to hold at least one share in the company. The information contained in the Memorandum contains:
Once your company is incorporated, you can not amend the Memorandum of Association, even if a person leaves the company or changes their name.
All limited companies must have Articles of Association – these lay out how the company is run, governed and owned by the members.
There are default Articles (“Model Articles of Association”) issued by Companies House, however you can choose to submit your own, as the model Articles are quite prescriptive.
The Articles should detail the following:
You can change the articles after incorporation but this can only be done by special resolution where the company shareholders have to agree the changes and the amended document must be submitted to Companies House within 15 days of the date of resolution.
As well as getting your head around the jargon, when you set up a limited company, you have some legal obligations to get to grips with, to both Companies House and HMRC.
There are many benefits of running your business as an incorporated entity.
If this is something you are considering, we can help you get your company up and running in no time. Find out more
Alternatively there is a load more useful information about setting up and running a limited company in our free guide, which you can download by clicking the link below.
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