Prepare documents agreeing how to run your company

When you register your company you need:

  • a ‘memorandum of association’ - a legal statement signed by all initial shareholders or guarantors agreeing to form the company
  • ‘articles of association’ - written rules about running the company agreed by the shareholders or guarantors, directors and the company secretary

You will also need details of either: 

  • your shares and shareholders - if you’re registering a company limited by shares
  • your guarantors and guarantee amount - if you’re registering a company limited by guarantee

Memorandum of association

If you register your company online, you don’t need to write your own memorandum of association. It will be created automatically as part of your registration.

If you register by post, use the memorandum of association template.

You cannot update the memorandum once the company has been registered.

Articles of association

You can either:

  • use standard articles (known as ‘model articles’) - these are the standard default articles companies can use
  • write your own and upload or send them when you register your company

Community interest companies

You cannot use limited company model articles if you’re setting up a community interest company (CIC).

Use the CIC regulator’s model constitutions instead.

How to supply details of your shares and shareholders

When you register a company limited by shares you need to include details of your shares and shareholders. This information goes in a document called the ‘statement of capital’ that you send to Companies House during registration.

Statement of capital and prescribed particulars

When supplying details of your shares and shareholders you must include:

  • the names and addresses of all shareholders - known as ‘subscribers’ or ‘members’
  • the number of shares of each type the company has and their total value - known as the company’s ‘share capital’

Share capital is not linked to how much the company is worth.

Example

A company that issues 500 shares at £1 each has a share capital of £500. 

You also need to include information in your statement of capital about what rights each class of share gives the shareholder. This information is known as ‘prescribed particulars’ and must include:

  • what share of dividends they get
  • whether they can exchange (‘redeem’) their shares for money
  • whether they can vote on certain company matters
  • how many votes they get

How to supply details of your guarantors and guaranteed amount

When registering a company limited by guarantee, you need to include details of your guarantors and guaranteed amount. This information goes in a document called the ‘statement of guarantee’ that you send to Companies House during registration.

Statement of guarantee

When supplying details of your guarantors and guaranteed amount you must include:

  • the names and addresses of all guarantors - known as ‘members’
  • the amount each guarantor has agreed to contribute if the company cannot pay its debts

The statement of guarantee must also set out information on the purpose and scope of the guarantee, including that guarantors:

  • are liable for no more than the amount they guarantee
  • will need to pay the guaranteed amount in the event that the company cannot pay its debts
  • will need to pay the guaranteed amount if they stopped being a member in the 12 months before the company closed

Example

A member has guaranteed £1 in the statement of guarantee. If the company cannot pay its debt while they are a member, or within 12 months of them closing down, they’ll need to pay £1.

Each guarantor needs to sign the statement of guarantee.

Part of Set up a limited company: step by step

  1. Step 1 Check if setting up a limited company is right for you

    1. Check what a private limited company is

    How you set up your business depends on what sort of work you do. It can also affect the way you pay tax and get funding.

    Most businesses register as a limited company or a sole trader.

    1. Find out about the different ways to set up a business
    1. Get help deciding how to set up your business

  2. Step 2 Choose your limited company type

    1. Check whether you'll be limited by shares or guarantee

  3. Step 3 Choose directors and a company secretary

    You must appoint a director but you do not have to appoint a company secretary.

    1. Find out what directors are responsible for
    2. Check who can be a director or company secretary

  4. Step 4 Decide who the shareholders are

    You need at least one shareholder, who can be a director.

    1. Check how to choose shareholders for a company limited by shares
    2. Find out how dividends from shares are taxed

  5. or Decide who your guarantors are

    You need at least one guarantor who can be a director.

    1. Check how to choose guarantors for a company limited by guarantee

  6. and Identify people with significant control (PSC) over your company

    You need to identify people with significant control (PSC) - for example, anyone with more than 25% of the shares or voting rights.

    1. Find out what counts as a PSC

    You'll confirm these when you register your company with Companies House.

  7. Step 5 Choose a name

    1. Check the rules for company names
    2. Check if the name you want is available
    3. Check existing trade marks

  8. Step 6 Prepare documents agreeing how to run your company

    You need to prepare documents agreeing how to run your company. These documents include the :

    • 'memorandum of association'
    • 'articles of association'
    • 'statement of capital'
    • 'statement of guarantee'
    1. You are currently viewing: Find out how to create these documents

  9. Step 7 Check what records you'll need to keep

    1. Check the company and accounting records you must keep

  10. Step 8 Register your company with Companies House

    You'll need to register an official address and choose a SIC code - this identifies what your company does.

    1. Check the rules for registered office addresses and email addresses
    2. Check what your SIC code is
    3. Register your company with Companies House

  11. Step 9 Find out what to do after you've registered

    There are some things you may need to do once you've registered a limited company.

    1. Add Corporation Tax services to your business tax account
    2. Check the next steps for your limited company