UK Limited Companies by Guarantee
Charitable Limited Companies
The unique quality of a Guarantee company
Guarantee companies are usually run for the benefit of members such as members of an association or club. The ‘guarantors’ give a personal amount they will pay in the event the company fails and owes debts. If they wish, Members can even give an unlimited guarantee and be responsible for all debts. Usually the aims and objects of the company are to promote the particular company and no dividends are paid to members, although they can properly take salary, bonuses, expenses, etc. for duties performed.
Guarantee companies are not seen as commercial trading companies and usually exist to raise funds for the benefit of others. A Guarantee company can obtain charitable status and raise funds if it desires or just operate as a members’ company without charitable status.
When a club or association is set up only the original members give the guarantee and it is up to the company if new people join as an ordinary member of the club or association or as a guarantee member. If the latter applies, then they need to be added to the list of company members, otherwise the club or association just maintains its own membership list and rules.
A Guarantee company means that you and your fellow members give a personal guarantee to pay an amount to creditors should the company fail. That guarantee can be as little as £1 each.
The advantages and disadvantages of a company
If a business fails, a small Guarantee can protect the owners of a Company from personal loss, or even bankruptcy. Unless you have given any separate guarantee for a particular transaction – or acted illegally – the debts are the Company’s, not yours.
This advantage increases with the growth in commitments the business makes in order to operate and develop.
A unique trading name
When a Company name is registered it has to be unique. For as long as the Company exists, the name can never be copied by another company. You can choose whether to have ‘limited’ at the end of the company name or omit it completely, providing the company has objects and aims, which promote commerce, art, science, education, religion or any particular profession.
Forming a Guarantee company in practice
1. A unique name
2. The right people
A company has to be owned. It need have only one owner but there are normally at least two. Owners are technically Members. All members give a guarantee to clear debts up to a fixed amount.
Managers: ‘Officers’ or ‘Directors’
Owners must appoint Officers to manage the business, which includes operating it according to the requirements of the Companies Acts. These are the Directors. In most Guarantee Companies, Directors are also the Members. A Company must have at least one Director and a Company Secretary. If there are two or more Directors, one of them can also be Company Secretary.
A ‘Company Secretary’
A Company Secretary must be appointed by the Members as the Officer of the Company specifically responsible for maintaining all statutory information about the Company.
3. A specific location – the registered office
4. Clear objectives – the memorandum and articles of association
Your company enters the register
TBA INCORPORATORS will register the company, obtaining a registration, adding it to the Company Register and providing you with a Certificate of Incorporation. This, or a copy, must be displayed at the Registered Office, and a copy will be required by the bank.
You are now a Member or Director (or both) of your Guarantee Company, and you can begin to trade under this name.
Requirements after registration
Once your company is registered, you must immediately meet a number of further requirements.
You should obtain a Company Seal for sealing certain documents.
The Company Secretary or your accountant can inform Companies House of the Accounting Date, that is, the end of the Company’s first Financial Year.
Now that your Company is fully established, there are a number of statutory requirements which must be met on an on-going or annual basis. The Company Secretary is responsible for seeing that these are done.
Regular & annual requirements
1. Change of company details
3. Company meetings
4. Accounts – Bookkeeping
5. Annual accounts
6. Annual return
Forming a Guarantee company
The advantage of professionals is that they can advise on Company names, they have proper systems to carry out Company searches, ensure forms are completed correctly, provide Objects, Memorandum and Articles, Company Seals, Nameplates, Statutory Declarations and so on. However, the range of services varies considerably. Be cautious about saving a few pounds on the basic cost – you may have to change things later, and that can prove expensive.
A ‘Company Kit’
Certificate of Incorporation
6 sets of Memorandum and Articles of Association
Company Seal and Press
Resignation of First Officers
Advice regarding the first meeting of Directors
TBA Incorporators Company Kit
TBA INCORPORATORS Kit has been designed to contain all the items you need for Registration of your Company, neatly packed in an attaché case. In addition, TBA INCORPORATORS can supply any other requirements for establishing your Company.
TBA INCORPORATORS Attaché Case – Certificate of Incorporation, 6 sets of Memorandum and Articles of Association (including Table A), Company Seal and Wallet, Members’ Register & Minutes of First Meeting.
TBA Incorporators range of services
As the leading Company formation agent, TBA INCORPORATORS offers one of the most comprehensive services available.
Guarantee Company Formation
Company formation includes a free Company Name Search, completion of all Registration requirements and provision of a Company Kit – an attractively packed set in a portfolio with all you need to start trading with your new Company.
Registered office address facilities
We can provide both a Registered Office facility and, if needed, a Company Secretary.
Company Secretary service
The role of a Company Secretary is a vital one, but the responsibilities can seem daunting. TBA INCORPORATORS can supply an efficient, professional Company Secretary service and advise Companies House of any change of Company particulars.
We can also organise VAT Registration for you.
Our service to new Companies extends to the final details such as provision of your statutory Company Seal.
FAQ – Frequently Asked Questions
What is the difference between a Guarantee and a Limited Company?
How much is the Guarantee for each member?
What are Guarantee companies used for?
If no shares are issued how can any profits be taken?
Can a Guarantee company become a charity?
Can a Guarantee company raise funds?
Does any members have different amounts of Guarantee?
Do all members have to give a Guarantee?
How are directors appointed?
Our company licensing services
— What we do and do not do
Our company is EXCLUSIVELY engaged in assisting worldwide clients, either individuals or corporate entities, to get duly and properly licensed with local Regulators and Financial Authorities to get respective official licenses to legally carry out their cryptocurrency or financial related business activities.
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Disclaimer: While TBA & Associates strives to make the information on this website as timely and accurate as possible, the information itself is for reference purposes only. You should not substitute the information provided in this article for competent legal advice. Feel free to contact TBA Customer Services for advice on your specific cases.