Limited Company Formation – Forming a Limited Company Today

More people are deciding to go it alone and start up their own business. There is obviously always a risk with running your own business but the benefits of independence and financial gain can be well worth the risk. The company formation process of registering a business is less complicated now with Companies House and Various company formation agents offering full guidance and assistance along the way. If you are considering setting up your own business then the following advice and guidance will prove valuable.

Limited company formation today is actually pretty simple: you have the shareholders who are only risking the amount of their investment and then you simply fill out the same paperwork that others fill out for regular types of companies. These forms are the IN01, the Articles of Association, and the Memorandum of Association. So, it is relatively easy and straight-forward.

The real question in limited company formation is whether or not the company is going to be public or private. A private company means that the members of the company do not have to disclose as much information about the company as they would if it were public. The thing is that the company then can’t be traded on any stock exchange. Therefore, the investors that you have when starting up are the only investors you have unless there is agreement to add more to the group. A public company must disclose certain information. Also, shares of this company can be traded on a stock exchange so getting new investors should be much easier than it would be for the private company.

Some people may wonder why there is appeal to limited company formation. They get a bit hesitant because of the word “limited.” In our language, “limited” means there are restrictions. As a rule, people tend to not like restrictions. So, why is forming this type of company a good thing? To begin with, it can be easier to get investors if you are forming this type of company. It makes them official shareholders in the company, while also alleviating them from the pressures of having to make any formal decisions about company operations. The investors are also only liable for the amount of their investment, so that is another plus to forming this type of company.

Of course, before you decide on limited company formation, you need to look at all of your options available for your business. You want to make sure that you have considered all types of company formations available before you decide on one. If necessary, consult with someone who has been in the business world for a while. They can help direct you to the type of company you should form and they also may know of some investors looking for a great investment opportunity. Whomever you form the company with; you need to be sure that you all are aware of the risks involved and the hard work that it is going to entail.