LTD the most common company in the UK

LTD is the most common legal form of company in the UK.This type of company is a limited liability company, which means that the shareholders are not personally liable for the debts of the company, beyond what they have invested in it. This business structure offers a series of advantages that make it very popular among new entrepreneurs. There are currently more than 4 million Limited Companies in the UK.

Advantages of LTD

One of the main advantages of an LTD is the protection of limited liability. This can be very attractive as the owners of the company are not personally liable for the debts. In case the company gets into financial difficulties, the personal assets of the owners are protected. This protection is undoubtedly very attractive to entrepreneurs because it allows them to conduct their business without putting their assets at risk.

The LTD offers a flexible management structure. Owners can be either individuals or other companies, and there is no maximum number of shareholders required. This gives entrepreneurs greater flexibility in management and decision-making. Its set-up also allows a single person to be the sole shareholder and director of the company. This simplifies the process of setting up the company.

Opening a LTD in the UK

Firstly, you need to assess whether setting up a Limited Company is the right business model for you. The process of registering an LTD in the UK is relatively straightforward. All companies must register with Companies House, the UK’s official register of companies. However, there are a number of decisions you need to make before you can complete this process.

Name of the LTD

The first step in setting up your company is to choose a name for your business. This name must not match any other company name that is already registered. In addition, you should avoid using sensitive terms or phrases that contain any political connections.

Tax address of the LTD

In order to set up the LTD you need to provide the company with a fiscal address. This is important because this is where you will receive all tax and government notifications. There are some companies that offer the possibility to acquire a virtual address.

Open a bank account

For the registration of the company it is necessary to have a bank account. This account must be registered in a different name to that of the business owner. The major UK banks offer specific business solutions for businesses. However, their fees can be somewhat unaffordable, especially for start-up companies. It is therefore advisable to check the business rates of some of the online banks.

Drawing up a memorandum for the company

It is important to draw up a memorandum of association that sets out the articles that will govern the new company. You can use the templates available on the UK government’s website to prepare a memorandum of association.

Registration with HMRC

You need to register the LTD to pay corporation tax. This is where you will also file your tax returns. One of the main advantages is that you can do the registration (and all subsequent transactions) online or by post.

Other aspects of LTD de most common company en the UK

Many new entrepreneurs decide to open an LTD in the UK. The reason for this popularity is not only to do with the obvious tax advantages that the country offers. The UK has always had a very good reputation in the financial world for its bureaucratic simplicity and business transparency. This is something that can be very attractive to new entrepreneurs as it can elevate the status of your business activities.