This article is about companies registered in England and Wales by companies house as at April 2014. Covering the basics of running a limited company. Officers of a company should be well informed about what is required off them,particularly by the Law. At this time, April 2014, the premier law governing the conduct of Companies in England and Wales is Companies Act 2006. It is beyond the scope of this article to do any more than highlight a few points.
A Company is a Legal entity in its own right, an its affairs ,managed by its officers, Directors, are separate from the affairs of the directors and shareholders.
Shares & Shareholders
Incorporated limited companies offer their share holders limited liability. A company may have several classes of shares depending on its articles of association . For most companies, the standard articles provided by Companies house are adopted hence generally you see ordinary shares with equal voting and dividend rights. Its a good idea to check the articles of a company before acquiring its shares.It should be noted that only listed companies in the UK may make public share offerings.
The Shareholders liability for the companies debts are is to the value of their shareholding in the company. In the event that the company is wound up, they are the last to be paid out of the proceeds of the process.
All companies must have at least one human director. Corporate bodies can also be company directors where there is at least one human director. Directors have a fiduciary duty to their companies. This means that while running a limited company, the director willingly undertakes to act in the best interests of the company and therefore its shareholders, at all times while holding office.
Generally, a director is not personally liable for the company’s debts. However, there are circumstances where a director might become liable for the company’s debts. These circumstances include,but are not limited to , where fraudulent conduct is proven, Director owes money to the company, director has given personal Guarantees for the company’s debts.
Company Statutory filings
The directors running a limited company have a duty to file the company’s accounts, in a format that meets Companies act demands, annually at companies house. Currently, the filing deadline is nine months after the year end for unlisted companies.
Companies are also required to file an annual return listing the officers of the company, the shareholders, the registered office of the companies and a few other details.
Maintaining the shareholder registry is clearly a critical function, and the location of where the shareholder registry is kept is one of the critical details on the annual return.
The directors of the company are required to file the company’s accounts, plus a completed corporation tax return with HMRC. This is usually annually, 12 months after the year end. Corporation tax if due, should be paid within 9 months of the year end