The limited company is one of the most popular business structures in the UK. This is due to a number of factors, including the financial protection – or limited liability – that it provides its owners, the ease in which one can be set up, and the various tax benefits that it has to offer. But who can take advantage of all these and actually form a company and who can’t? Let’s take a look.
Anyone can form a company but not everyone can be a company director
To form a limited company you need to provide certain information about the company that is being formed as well as information about the people behind it. This includes:
- The company’s official address, known as the registered office
- The company’s name
- The industry (or industries) that the company will be operating in (this is provided via SIC codes)
- Director details (the director runs the company)
- Shareholder details (the shareholder owns the company) including the number of shares that they are to hold
- Person with significant control details (the PSC ultimately controls the company)
You only need one person to form a company. This person would be the director, shareholder and PSC. Alternatively, you can have multiple people (or even companies, these are known as corporate appointments) taking on different roles.
As long as permission has been provided, anyone can form a limited company on behalf of someone else.
When we ask ‘Who can form a company?’, we should instead be asking, ‘Who can be a limited company director?’. This is because, perhaps surprisingly, there are no restrictions at all on who can be a company’s shareholder or PSC. There are, however, restrictions in place on who can be a company director.
Who can be a company director?
Any individual can be a director, provided they are at least 16 years old, and not any of the below:
- Disqualified from being a director by a court order
- Disqualified by the company’s memorandum and articles of association (these are the documents that set out how a company is to be run)
- An undischarged bankrupt (this is someone who has been declared bankrupt and is currently adhering to the terms of their bankruptcy)
- The company’s auditor
To confirm, it does not matter where the director-to-be resides or what nationality they are.
To put it simply
And so, to answer our initial question, anyone can form a company.
But the question that gets a more useful response is, ‘Who can be a limited company director?’. The answer to this is anyone, just as long as they’re at least 16 years old, have not been disqualified from being a director (by a court order or the company’s own memorandum and articles of association), are not bankrupt, and they are not the company’s auditor.
We can help you form a limited company
To start your limited company all you need to do is:
- Choose your company name
- Pick your package (use our ‘Package Selector Tool’ if you’re having trouble deciding)
- Make payment
- Complete the company formation process
We’ll then digitally send your company formation application to Companies House where it’s normally accepted within 3-6 working hours. You will receive an email confirmation as soon as your company has been incorporated.
Thanks for reading
We hope you have found this helpful.
For the purposes of this post, we concentrated on the most common company type, a private company limited by shares. If, however, you do have any questions about other company structures (or anything else related to company formations), please leave a comment and we’ll be happy to help.