Any business should consider incorporating itself if they are interested in making in profits. By taking advantage of all the facilities that a business gets when it incorporates itself most organizations not only grow but thrive as well. Incorporation offers many other benefits and advantages to business owners both big and small. However the best advantage that a business can get from incorporating itself is the protection of personal assets and property of its board members and shareholders. As owners of a corporation, shareholder liability is only limited to the amount invested in the business. This means that if your corporation runs into losses or bankruptcy your personal assets will not be affected. In contrast, if you have a sole proprietorship business or are in a partnership, your personal assets can be taken away.
Incorporation in the UK
Many businesses choose the United Kingdom to set up overseas incorporations in mainly because of the country's stable economy. This ensures that even if a company does not rake in profits, it will at least do well enough to sustain itself. Additionally by incorporating your business in the UK you open yourself up to a much larger market to invest in. Another advantage of having a UK based company is that it automatically gives you entry into the European Union market as well, without any hassles. Another important point about setting up an incorporation in the UK is that the principal governing legislation for all English Welsh and Scottish companies can be found in the Companies Acts' of 1985 and 1989.
Features of incorporations in UK
To incorporate a company in the UK is a quick and informal process; this is because a UK limited company is a flexible corporate vehicle. Some principal features of UK incorporations are:
The directors of a company can be either individuals or corporate entities.
A minimum of two people is needed to setup a company. This usually comprises of one director and one secretary.
Directors have no residency or nationality restrictions.
The company secretary can either be an individual or another corporate entity.
The company secretary may or may not be a UK resident.
Any companies wishing to incorporate itself should have at least one subscriber or shareholder at the time of incorporation.
All corporations need to have a registered office address in the English and Welsh jurisdiction.
All shares should be denominated in Pounds Sterling but technically can be also denominated in any other legal tender currency.
If the company trades in the UK and its annual gross income is over £55,000 then it needs to register for VAT or Value Added Tax.
An annual return must be filed which formally names the directors, secretary and shareholders of the company. The filing fee is for this is £15 at the moment. A company is required to file annual accounts unless it does not trade in the country.
There is no restriction upon the shareholders being foreign nationals or companies.
English and Welsh companies are not legally required to use a seal for their contracts or other legal documents.
A corporation can be started with an initial capital of even £1.
At the moment profits of a corporation are taxed at the rate of 21% per annum, as long as profits are under £300,000.
Both the director of the company and the company secretary can be other companies.
