Home
Knowledge
UK Business Registration UK Company Registration UK Company Compliance and Maintenance Guide
KNOWLEDGE|
(1) |
Company Secretary You do not need a company secretary for a private limited company. Some companies use them to take on some of the director’s responsibilities. The company secretary can be a director but cannot be: (a) the company’s auditor (b) an ‘undischarged bankrupt’ - unless they have permission from the court The restrictions placed on a person when they’re made bankrupt usually end when they’re free from their debts (known as ‘discharged’). You can check if someone has been discharged using the Insolvency Register. |
|
(2) |
Registered Office All UK limited companies are required to provide a registered office address. The registered office must be able to receive letters and documents relating to the company. Companies House do not allow the use of a PO Box address for the registered office of a company. The address must also be in the country of incorporation. Therefore a company registered in England and Wales must provide an address in England or Wales. Likewise, companies registered in Scotland must have a Scottish address. UK companies are legally required to display the registered address on all stationery and correspondence with clients. This includes invoices and letters. The company name must be displayed outside address or at the entrance to the building if it is a large building with many offices. Since the introduction of the Companies Act 2006, it is also a legal requirement to display your registered office address on your company’s website. |
|
(3) |
Local Director A UK company is required to appoint at least one individual over the age of 16 as its director. Directors are legally responsible for running the company and making sure company accounts and reports are properly prepared. A director of a UK company can be a non UK resident and live anywhere in the world and there is no requirement for them to live in the UK during or after their appointment as company director. Directors’ names and personal information are publicly available from Companies House. As directors must provide a service address (or ‘correspondence’ address), which will also be publicly available. |
|
(4) |
Event Driven Reporting Requirements Under the Companies Act 2006, the company must inform Companies House of corporate changes including: (a) Notification of a change in the company’s officers or in their personal details; (b) Changes to the company’s registered office; (c) Allotment of shares; (d) Changing the accounting period end; (e) Registration of a charge (this can be registered by any party with an ‘interest’ in the charge and not just the company); (f) Change of company name; (g) Change of constitution; and In addition to the above, companies must also maintain a minute book and registers of the company either at its registered office address or another nominated address. |
|
(5) |
Confirmation Statement Every UK company must file a Confirmation Statement (previously known as Annual Return) with Companies House every year. The purpose of the Confirmation Statement is to report: (a) Registered office address; (b) Principal business activity; (c) Address of where the company’s list of shareholders is kept; (d) Type of limited company, e.g. limited by shares or limited by guarantee; (e) Name and address of all company directors; (f) Name and address of the company secretary (if applicable); (g) The number and value of shares issued by the company, including the ownership of same; and (h) Where details of ‘debentures’ are kept (if applicable). Whilst there are no late filing penalties associated with Confirmation Statement should the deadline be missed, Companies House however can commence strike off and/or prosecution proceedings against the company and its directors if the Confirmation Statement is not filed properly. |
|
(1) |
Corporation Tax (CT) Companies must prepare and file a Corporation Tax Return to report the company’s corporation tax to HM Revenue and Customs (HMRC). The CT Return must be completed even if the company does not have any tax to pay, unless HMRC is advised that the company being dormant for CT purposes. Details on the CT Return must include, but are not limited to, the following: (a) Capital allowances to be claimed for business assets purchased; (b) Gains on assets that have been sold in excess of the purchase price; (c) Directors’ loans not repaid at the end of the company’s financial year; (d) Repaid directors’ loans for the purposes of reclaiming tax; (e) Reliefs to be claimed; and (f) Any losses carried forward from the previous accounting period. The deadline for paying corporation tax is 9 months and 1 day after the company’s chargeable accounting period end and the deadline for filing a CT Return is 12 months after the company’s accounting period / year end. Companies defined as ‘large’ are required to pay their UK corporation tax liabilities in quarterly instalments, with the first instalment normally being due 6 months and 13 days after the commencement of the accounting period. The penalties for the late filing of a CT return are as follows:
If the return is filed late three times in a row, the £100 penalties are increased to £500 each. |
||||||||||
|
(2) |
Value-added Tax (VAT) (a) VAT Registration VAT is the tax charged on most goods and services that are purchased in the UK and equivalent in Europe. It is known in some countries as Goods and Services Tax (GST), but not the same. From 1 January 2021, the threshold for registering VAT is £90,000. It is based on a 12-month rolling period so not just for the fiscal year 6th April to 5th April (the UK tax year). If it is likely that your sales of goods/services that would be applicable to UK VAT exceed £90,000 in a 12-month period looking back and forward, then you must register for UK VAT. However, companies can choose to voluntarily register as VAT taxpayers even if their annual turnover is less than £90,000. Registering as a VAT taxpayer may bring two benefits to the Company. The first is to increase your company's cash flow, and the second is to enhance customer confidence in the company because not registering for VAT means that your UK company is very small. (b) VAT Filing and Payment By default, all VAT registered businesses are required to file their Vat return and make payment of VAT quarterly. However, business may request and if approved, file their Vat return on a monthly or yearly basis. VAT return and payment deadline is one calendar month and seven days after the end of the VAT period. For example, for the quarter ending 31 June 2020, your return must be submitted and payment cleared in HMRC’s account by 7 August 2020. It shall be noted that the payment of VAT should be cleared by the reporting deadline. |
||||||||||
|
(3) |
Pay As You Earn (PAYE) PAYE is a tax collection system. It ensures that the Government gets tax revenue from employed workers as soon as they start earning. You, as the employer, are responsible for running it. You may choose to engage an accountant, like Kaizen to do this work for you. Under PAYE, you are responsible for deducting income tax and National Insurance Contributions from your employees’ wages and paying this to HMRC every month. You also have to pay additional National Insurance Contributions as an employer. These contributions are called Employer’s Class 1 National Insurance Contributions. You are also responsible for sending in returns to HMRC showing the income tax and National Insurance due and paid |
|
(1) |
Financial Statements Your company’s annual accounts - called ‘statutory accounts’ - are prepared from the company’s financial records at the end of your company’s financial year. Statutory accounts must include: (a) a ‘balance sheet’, which shows the value of everything the company owns, owes and is owed on the last day of the financial year (b) a ‘profit and loss account’, which shows the company’s sales, running costs and the profit or loss it has made over the financial year (c) notes about the accounts (d) a director’s report (unless your UK company is classified as a ‘micro-entity’) You must always send copies of the statutory accounts to: (a) all shareholders (b) people who can go to the company’s general meetings (c) Companies House (d) HMRC as part of your Company Tax Return You have different deadlines for sending your accounts to Companies House and your tax return to HMRC, but you may be able send them at the same time. If your company is small, a micro entity or dormant, you might be able to prepare and deliver a simpler (‘abridged’) accounts. |
||||||||||||||||||||
|
(2) |
Appointment of Auditor An auditor of a private company must be appointed for each financial year of the company, unless the directors resolve otherwise on the grounds that audited accounts are unlikely to be required. The directors appoint the first auditor of the company. He or she then holds office until the end of the first meeting of the shareholders at which the accounts are laid before the members. At that meeting the members can re-appoint the auditor, or appoint a different one, to hold office from that date until the end of the next shareholders' meeting at which accounts are laid. However, private companies can pass an 'elective resolution' not to lay accounts before the members in a general meeting. If this is done, then the auditor has to be re-appointed, or a new one appointed, at another meeting of the company's members that must be held within 28 days of the accounts being sent to the members. The auditor is responsible for making a report to the company's members on all accounts of the company. The auditors' scope of work as required by the Companies Act requires them to report whether, in the auditors' opinion the annual accounts give a true and fair view of the balance sheet and profit and loss account and that the accounts have been properly prepared in accordance with the relevant financial reporting framework including international accounting standards and the requirements of the Act. |
||||||||||||||||||||
|
(3) |
Audit Exemption In accordance with the Companies Act, a stand-alone company, that is, a company which is not a member of any group, that qualify as a small company under Companies Act 2006 is usually exempt from audit. A company is small if for both this year and last year it was not ineligible, and it met two out of three of the following criteria:
This applies to first financial year or takes two years to change. i.e. in relation to a subsequent financial year, where on its balance sheet date a company meets or ceases to meet the qualifying conditions that affect its qualification as a small company only if it occurs in two consecutive financial years. If your UK company is a member of a group, you can take the audit exemption if you are a small member (apply the limits given above) of a small group. To qualify as a small group, the group must meet 2 out of the 3 requirements, applying either net or gross thresholds.
Net = as per the consolidated accounts Gross= adding together the individual accounts before deducting intragroup transactions/ balances. N.B. these thresholds are for the whole worldwide group of companies. This applies to first financial year or takes two years to change. i.e. in relation to a subsequent financial year of the parent company, where on the parent company’s balance sheet date the group meets or ceases to meet the qualifying conditions that affects the group’s qualification as a small group only if it occurs in two consecutive financial years. |
||||||||||||||||||||
|
(4) |
Annual Accounts Filing Requirements The annual accounts for a UK Limited Company are normally due to be filed with Companies House by 9 months after the company’s financial year end. Late filing will be subject to penalties listed in the table below:
Penalties are doubled where a company files its accounts late for a second year. Continued non-filing of the accounts can lead to prosecution of the directors and striking-off of the company, with forfeiture of the company’s assets. |
|
Item |
Services |
Fee (£) |
|
|
Basic Annual Maintenance |
|||
|
1 |
Registered Office Address |
Yearly |
|
|
2 |
Preparation of Annual General Meeting and Filing of Confirmation Statement |
Yearly |
|
|
Subtotal: |
500 |
||
|
Other Maintenance Services |
|||
|
3 |
Preparation and Filing of Annual Accounts (Dormant) |
Yearly |
250 |
|
4 |
Preparation and filing of Corporation Tax Return (Dormant) |
Yearly |
250 |
|
5 |
Accounting and bookkeeping |
Monthly |
150 up |
|
6 |
Preparation and filing of Corporation Tax Return (with computation) |
Yearly |
500 up |
|
7 |
VAT Registration (Voluntarily) |
One off |
300 |
|
8 |
VAT Registration (Mandatory) |
One off |
300 |
|
9 |
Preparation and filing of VAT Return |
Quarterly |
150 up |
|
10 |
Financial Statement Statutory Audit |
Yearly |
4,500 up |
|
11 |
Preparation of unaudited financial statements |
Yearly |
2,000 up |
|
12 |
PAYE Number registration |
One off |
300 |
|
13 |
Pension Scheme registration and change of Particulars of current staff |
One off |
200 |
|
14 |
Payroll processing |
Monthly |
60/head |
|
15 |
Pension Scheme calculation and submission |
Monthly |
20/head |
|
16 |
Processing the conversion of pension provider or payroll system |
One off |
100 |
|
Disclaimer All information in this article is only for the purpose of information sharing, instead of professional suggestion. Kaizen will not assume any responsibility for loss or damage. |
Language
close
