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The Process Of Company Incorporation
For those considering company incorporation in the United Kingdom, (or indeed in overseas locations such as the USA) the prospect can be a daunting one. This article looks at some of the obstacles in the way of completing the process, both psychological and legal.
As soon as an individual, or a group of individuals, begin making money by offering goods or services, that group is required by law to register the operation. This is usually done by registering with Companies House, a department of the UK government. Company incorporation in Britain involves a company being registered in a specific region of the country.
Scottish companies would be 'registered in Scotland'. Welsh companies can be registered in either 'England and Wales' or 'Wales'. English companies must be 'registered in England and Wales'. These statements are found on official paper and electronic correspondence of the companies involved.
Once company incorporation occurs and trading begins, a company has 3 months to register with the Inland Revenue. A penalty fee applies if this timescale is not adhered to.
The process of company incorporation has resulted in 2.1 million companies being registered with Companies House. It offers electronic company incorporation, which represents 83 percent of new companies being formed. 40 percent of related documents are filed and stored electronically.
Before the process of company incorporation begins, a person or persons must make the decision to become a company. For many people, this involves the consideration of many things. A good business plan is essential, and is likely to have been made in order to obtain credit from banks before company incorporation is considered. In these challenging economic times credit can be harder to obtain - and indeed the whole idea of starting a business can be called into question.
There is a school of thought that says, however, that now is a great time to start a company. Favourable rents can be secured, as well as cheaper labour (as mass unemployment drives down wages). Richard Branson recently pushed this idea whilst being interviewed on the BBC. He suggested that getting in a good position for when the upturn comes is a good approach; cashing in when the boom times return. This may be true of the UK, America and many other nations. Waiting for the upturn to begin, however, could mean a company is not fully prepared to capitalise on new money.
Whenever someone decides to go ahead with company incorporation, the process in the UK is fairly straight-forward. In fact, compared to some nearby nations such as France, the UK is a flexible place to do business - and far less red tape poses obstacles to British entrepreneurs. Similarly, the USA makes it simple to start doing business, as would be expected from the pioneer of modern capitalism.
About the Author Dominic Donaldson is an expert in the corporate industry. Find out more about Company Incorporation and how the services available can help with starting a company within the US.
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