What is the main source of law authorising this entity form?

Companies Act 2006 (CA 2006).

Give a brief summary of the entity form:

Does the entity possess separate legal personality?

Possesses separate legal personality.

(Maximum) period of existence

Governing document(s)

A company is governed by its constitution, namely the Articles of Association which sets out its internal rules including how shares can be transferred and the rights attaching to shares. The person forming the company can either prepare tailored articles or adopt the relevant statutory model articles (or a combination of both).

Liability of incorporators / shareholders

Liability of shareholders is limited to the amount subscribed for shares (subject to circumstances where limited liability can be lifted as a result of wrongdoing by directors who are also shareholders).

(Governing) bodies

Companies incorporated in England and Wales are governed by the laws of England and Wales.

Other particularities

Can this type of entity be involved in international transactions and restructurings (e.g. cross border mergers, asset acquisitions and divestitures, equity acquisitions, conversions etc.)?

Yes.

Can this type of entity be publicly listed or held, or its securities be issued to members of the public?

No, but a limited company can be converted into a public limited company (PLC) if required and if the company meets the relevant criteria to become a PLC.

Can this type of entity be used for a non-profit or charitable organization?

Yes, but it may not necessarily be the best option and it may be better to use a company limited by guarantee, charitable incorporated organisation, charitable community benefit society, charitable trust, or unincorporated charitable association.

Give a brief summary of the process of incorporation, formation, or organization, including:

Main documents required

The main documents to be lodged with the Registrar at Companies House on incorporation are:

• Form IN01 – to include information in relation to the company's intended principal business activities, a statement of capital, initial shareholdings and persons with significant control (PSCs), along with confirmation that the subscribers wish to form the company for lawful purposes (among other things);
• Memorandum of Association; and
• Articles of Association (if amending or replacing model articles).

Involvement of notary, company register, governmental authorities

Company starts to exist when Registrar issues the certificate of incorporation (which details the official company number and date of incorporation).

Timing (estimate)

Main costs, including registration and similar fees (excluding legal fees)

Fees and timings:

• Normal hard copy service: £71 standard fee (usually processed within five (5) days of receipt).
• Electronic service: £50 standard fee; £78 for same-day service.
• Certificate of incorporation: £15 standard fee (usually issued within eight (8) to 10 days); £50 for same-day issue service.

Is a description of the anticipated business or purpose of the entity required for incorporation, formation or organization?

Minimum number of incorporators / shareholders and residency requirements

Minimum of one (1) shareholder who must be an individual over the age of 16.

No residency requirements.

Minimum number of directors (or other applicable officers) and residency requirements

Minimum of one (1) director (who can be the same person as the sole shareholder).

No residency requirements.

The government has announced its intention to impose restrictions on the use of corporate directors, including (among other things) a ban on overseas corporate directors of UK companies.

Minimum share capital, or equivalent, and payment requirements (including opening a bank account)

No minimum share capital or payment requirements. A company will usually have a share capital account (to account for the proceeds from the issue of shares up to their nominal value) and a share premium account (to account for the proceeds from the issue of shares over and above their nominal value).

Is the physical presence of incorporators/directors/shareholders required in the jurisdiction for incorporation, formation, or organisation?

No (though note proposals mentioned above to ban overseas corporate directors).

Is a tax identification number, or equivalent, required? If so, how is it obtained?

A company is issued with a Unique Taxpayer Reference (UTR) from the HM Revenue and Customs (HMRC) shortly after incorporation. A company must register for corporation tax within three (3) months of commencing business, and a UTR is essential for this.

What is the title of the applicable company registry?

Companies House.

What types of information must be filed at the (company) register, and which of them will it be publicly available, e.g.: Articles or other formation document, Articles or other formation document, Group structure, Share capital, Directors, Accounts, Insolvency, good-standing, liquidation, Liens and encumbrances on the shares, Liens and encumbrances on assets of the entity, Other (e.g. litigation, tax matters)

The following must be filed at Companies House (and are all publicly available):

• Memorandum of Association;
• Articles of Association (if amending or replacing the model articles);
• Annual confirmation statement (previously the annual return) containing details about directors, shareholders, registered office address (and registered email address, though not publicly available), share capital and confirmation that the intended future activities of the company are lawful;
• Annual statutory financial accounts;
• Information in relation to PSCs; and
• There is a concept of voluntary registration of company charges but, because of sanctions for non-registration, a company will usually deliver a statement of particulars for any charge it gives over its assets.

What is the title of the executive body and its members? What are their main duties, tasks and responsibilities?

The Board of Directors is the Executive Body of a company, and their main job is to make decisions on the general day-to-day running of the company. Many directors will have service agreements which will detail their responsibilities in greater depth.

The Board of Directors' statutory duties are governed by the CA 2006 which supplement the fiduciary duties set out in case law. Principal duties include the following duties for a director to:

• Act within his or her powers (s 171 CA 2006);
• Promote the success of the company for the benefit of the members having regard to the matters set out in s 172 CA 2006;
• Exercise independent judgment (s 173 CA 2006);
• Exercise reasonable care, skill, and diligence (s 174 CA 2006);
• Avoid conflicts of interest (s 175 CA 2006);
• Not accept benefits from third parties (s 176 CA 2006); and

Directors should also have regard to the Wates Corporate Governance Principles for Large Private Companies and the Institute of Directors' Voluntary Code of Conduct for Directors.

How are the members of the executive body appointed, dismissed and replaced?

Appointment:

• The first directors of a company are appointed by notification to Companies House during the incorporation process of a statement of proposed officers setting out the particulars of each director (to include a statement that each director has consented to act in that capacity).
• Subsequent directors are appointed by reference to the company's Articles. The statutory model Articles enable the Board of Directors to appoint directors (if applied and this could be varied). The general meeting (of the shareholders) also has the power to appoint directors under the model Articles.

Dismissal/replacement:

• Directors may be removed by ordinary resolution at a general meeting (passed by a simple majority of the shares of the shareholders who vote) provided special notice of the meeting has been given and the statutory procedure set out in the CA 2006 has been followed. However, advice should be taken when removing a director to ensure that any contractual provisions entered have not been breached.
• A company's Articles may also provide for a different process to affect a dismissal/replacement.

Is it possible to appoint corporate directors or must all directors be natural persons?

It is currently still possible to appoint a company as a director of an English company. However, the government has announced forthcoming changes to company legislation placing restrictions on the use of corporate directors. Broadly, corporate directors will only be permitted if their own directors are natural persons (i.e. individuals) and their identities are appropriately verified before the corporate director is appointed. Further, it is expected that only UK entities with legal personality (e.g. companies and limited liability partnerships) will be allowed to serve as corporate directors (i.e. ban on overseas corporate directors).

We do not yet have an implementation date for this reform.

Is there a requirement to have non-executive directors? How are they appointed, dismissed and replaced? Do non-executive directors serve on a separate body (two-tier structure) or can a one-tier board (with executive and non-executives) be appointed, or is some alternate structure used?

There is no requirement to have non-executive directors and often there are none in private limited companies. They are more common in PLCs.

What is the title of the body of owners / shareholders / members, and what are the main tasks / responsibilities / powers of that body?

There is no specific title for the body of shareholders or members who own the company.

Shareholders are responsible for the major decisions that a company must make, and the following decisions are examples of those only able to be made by shareholders:

• Amending the company's articles;
• Approving a substantial property transaction;
• Approving a contract to buy back the company's shares; and
• Removing an auditor of the company.

What are the majority and quorum requirements for decisions by the shareholders? Can they be varied or changed?

Shareholder decisions (examples of which are noted above) are either passed by way of:

• Ordinary resolutions; or
• Special resolutions.

An ordinary resolution is passed:

• At a meeting on a show of hands by a simple majority if it is passed by a simple majority of the votes cast by those entitled to vote; or
• On a poll taken at a meeting by a simple majority if it is passed by shareholders representing a simple majority of the total voting rights of shareholders who (being entitled to do so) vote in person, by proxy or in advance.

A special resolution is passed:

• At a meeting on a show of hands if it is passed by a majority of not less than 75% of the votes cast by those entitled to vote; or
• On a poll taken at a meeting if it is passed by shareholders representing not less than 75% of the total voting rights of shareholders who (being entitled to do so) vote in person, by proxy or in advance.

All shareholder resolutions may be passed by written resolution rather than calling a general meeting (providing the statutory procedure is followed), except where the decision involves dismissing a director or the company's auditors.

The quorum for the meeting of shareholders is usually set out in the company's Articles of Association. The default position (subject to anything contrary in the Articles) is that a quorum is two (2) shareholders, unless it is a single-member company, in which case the quorum is one (1).

Any special governance regimes (e.g. depending on size, being listed at a stock exchange, or other criteria)?

Different accounting obligations apply to different companies dependent on annual turnover, balance sheet total and number of employees. Based on annual turnover, a company would be described as a micro-entity if turnover is £1 million or less; small, if turnover is £15 million or less; medium, if turnover is £54 million or less; and large, if turnover exceeds £54 million).

What are the periodic accounting obligations incumbent upon the entity? To whom must those accounts be submitted?

All companies (whether or not they are in business) must keep adequate annual accounting records.

These must be filed at Companies House within nine (9) months from the Accounting Reference Date (ARD) (the date on which a company's financial year ends unless it is the first accounts of the company being filed in which case the deadline is 21-months after registration with Companies House).

Is the entity permitted to determine its own financial year?

The ARD set on incorporation is the last day of the month of the anniversary of the company's incorporation (unless otherwise specified or varied).

The ARD can be altered by submitting Form AA01 to Companies House.

Is the entity subject to any statutory (external) auditor obligations?

Unless the company is exempt (see below), companies must appoint a statutory auditor and file an auditor's report on their accounts, strategic report, and directors' report (at the same time as filing their annual accounts).

Exemption for small/dormant/qualifying subsidiary companies – but these companies must still file unaudited accounts at Companies House.

Requirements to appoint other persons (officers, secretary, internal auditor / accountants). If so, what are their functions? Are there any residency requirements?

Unless exempt, all companies must appoint an external/statutory auditor.

A private company is not required to have a Company Secretary (a dedicated person who deals with legal administrative requirements) and smaller companies generally do not have them.

What is the title designated for 'ownership interests' (e.g. shares, quota, interests, membership)?

Membership interests are held in shares. Holders of shares are referred to as shareholders or members.

Are different classes of ownership interests possible? If so, what are some examples of different classes?

Different classes of shares are possible and often used. Common examples include:

• Ordinary shares (shares other than those which carry a special right to dividends or capital);
• Preference shares (shares which rank ahead of other shares for dividends and capital and which can sometimes carry limited voting rights);
• Deferred shares (shares with no right to dividends either for a set period or until certain conditions are met); and
• Redeemable shares (shares that are to be redeemed or are liable to be redeemed at the option of the issuing company or the holder).

What documentation is required for the transfer of ownership interests?

Typically, a transfer of shares will involve the following documentation:

• Stock transfer form;
• Share purchase agreement;
• Board minutes of the company approving the registration of the stock transfer form (subject to stamping or exemption to stamping);
• New share certificate issued to the transferee; and
• Other ancillary documents depending on the transaction and the buying and selling entity/person.

Are there any additional formal requirements required for the transfer of ownership (notary, approvals, stamping, filings, corporate records)?

Following approval of the registration of a transfer of shares (by the Board of Directors), the administrative requirements are:

• Unless the consideration is less than £1,000, the stock transfer form must be sent to HMRC for stamping or adjudication as non-stampable within 30 days of it being signed and dated. The HMRC process no longer requires physical stamping, but electronic submission of the stock transfer form and written confirmation is provided by HMRC that stamp duty has been paid;
• The new shareholder should be entered into the company's register of members, subject to the stock transfer form being stamped, exempt from stamping, or adjudicated as non-stampable;
• The register of transfers should be updated (if the register is maintained);
• The register of people with significant control (if applicable) should be updated and notice of any change provided to Companies House; and
• When the next confirmation statement is due for filing, the transfer will need to be reflected in the statement.

Are there any applicable stamp duties imposed when transferring ownership interests?

On a transfer of shares where the consideration exceeds £1,000, the transferee must pay the sum of 0.5% of the consideration as stamp duty to the HMRC unless the transfer is exempt from stamp duty (the stamp duty is calculated on each transfer (i.e. stock transfer form) and rounded to the nearest £5).

How are shares issued? (including information on payment obligations, registration requirements)

Shares are deemed to be issued when the recipient has been entered in the company's register of members.

It is not necessary to file the register of members at Companies House, but an offence is committed if the company fails to keep and update its register of members. It is a requirement to notify Companies House of PSCs of the company.

Further information on equity contributions, e.g., non-cash payments on shares, (share premium) contributions without issuances of shares, can partially paid shares/ownership interests be permitted and what are the restrictions on them?

Non-cash payment on shares is permissible and common examples of alternative consideration include:

• Allotment/issue of shares in the buyer to the seller instead of cash consideration;
• Allotment/issue of shares in consideration of the capitalisation of debt or in consideration for a service provided; and
• A share for share exchange, meaning shares in one company are exchanged for shares in another.

Capital contributions (without issuing shares) are not recognised by English company law and are not legally equivalent to share premium. However they do constitute owners' equity generally and can be used as the directors see fit (subject to more limited uses).

Any requirements with respect to share cancellation, share repurchase and other capital reductions

Share cancellation

Redeemable shares (which a private limited company is permitted to issue) are treated as cancelled when they are redeemed, and the amount of the issued share capital is diminished by the nominal value of the shares redeemed.

Share buy-back

A private limited company may purchase its own shares, but only in accordance with strict statutory conditions and subject to restriction/prohibition in its articles.

A buyback can be financed:

• From distributable profits (the most common method).
• From the proceeds of a fresh issue of shares made for the purpose of financing the buyback.
• Out of capital.
• If permitted by the Articles, out of capital up to, in any financial year, the lower of £15,000 and the nominal value of 5% of its fully paid share capital using the de minimis exemption, which bypasses the standard procedure for financing a buyback out of capital.

There are various conditions for a buyback including that shares must be fully paid.

Other capital reduction

Permissible if approved by a special resolution of shareholders (provided it is not prohibited by the Articles) which is supported by either court approval or a solvency statement (which is to be provided by the directors).

Any requirements with respect to distributions to shareholders?

Subject to part 23 of the CA 2006, distributions are permissible if:

• There are sufficient distributable reserves available to make the distribution (cannot be made out of capital) (s 830(1) of the CA 2006).
• The distribution is justified by reference to relevant accounts (s 836 CA 2006).

Can the owners or shareholders adopt a restrictive or governing agreement among themselves such as a Shareholders Agreement?

Shareholders agreements (setting out the relationship between the shareholders) are common.

Which are the typical annual maintenance costs of maintaining the existence and legal good standing of such an entity (excluding legal fees)?

The taxes applicable to a private limited company are as follows:

• Corporation tax;
• Value Added Tax (VAT);
• Stamp duty where applicable; and
• PAYE (income tax and national insurance on staff salaries).

Other than tax, there is an annual filing fee with the confirmation statement of £34 (if filed online) or £62 (if filed by paper). There are also penalties/fines applied for late filing of documents with Companies House and in particular automatic fines apply when the statutory annual accounts are not filed on time.

What are the general corporate tax rates? (Specify if there is a national versus local distinction).

The main corporation tax rate for company profits is 25%. There is a small companies’ tax rate of 19% for companies with profits up to £50,000. Tax rates are subject to change if government policy changes.

Summary of any specific matters, e.g. recent or prospective major legal developments

• Mandatory climate-related financial disclosures apply to all large UK-registered companies (i.e. private limited companies with over 500 employees and an annualised turnover greater than £500 million; certain PLCs are also in scope). Such companies must include these disclosures in their annual reports.
• The Economic Crime and Corporate Transparency Act 2023 (ECCTA) received Royal Assent in October 2023. ECCTA introduces significant reforms to UK corporate transparency (primarily via amendments to the CA 2006) and the role of Companies House.

These changes include (among others):

• Broader Registrar's powers, placing Companies House as a more active gatekeeper over company creation and custodian of more reliable data, including new powers (already in force) to: verify and decline information submitted to it; annotate or remove inaccurate information already on the register; undertake stronger checks on company names; and share data with other governmental departments and law enforcement agencies.
• Introducing an identity verification (IDV) regime for all new and existing company directors, PSCs and those filing documents at Companies House. Voluntary IDV was introduced in April 2025. From Autumn 2025, IDV is expected to become mandatory for all new directors and PSCs. There will be a transition period for existing directors and PSCs to comply with IDV (i.e. tied into the company's next confirmation statement date). From Spring 2026, it is expected that individuals submitting filings at Companies House will need to have completed IDV.
• Introducing an identity verification (IDV) regime for all new and existing company directors, PSCs and those filing documents at Companies House. Voluntary IDV was introduced in April 2025. From Autumn 2025, IDV is expected to become mandatory for all new directors and PSCs. There will be a transition period for existing directors and PSCs to comply with IDV (i.e. tied into the company's next confirmation statement date). From Spring 2026, it is expected that individuals submitting filings at Companies House will need to have completed IDV.
• Giving greater protection to personal information provided to Companies House to limit the opportunities for fraud.
• A new direct power for the Registrar to impose financial penalties of up to £10,000 for breaches of the CA 2006 (CA 2006) without first going through the courts. This is in addition to existing powers to prosecute criminal offences under the CA 2006.
• A new corporate offence of failing to prevent fraud (in force from 1 September 2025) and widening the scope of the corporate criminal liability regime for offences committed by ‘senior managers’ (in effect since 26 December 2023).