If you own your own company and trade as a sole trader then you are personally responsible for everything, whereas a limited company exists in its own right, and it means that the owners are not directly responsible for the company's finances in the event of bankruptcy.
Why buy a limited company?
One of the key benefits of buying a shelf company is that the process is quick and the company can be ready to use almost instantly. There will be some further work to do before the company is suitable to be used, however, it will take far less time than starting a business from scratch.
Benefits of buying an existing limited company
- An off-the-shelf company has already been set up correctly and a simple change of the company officers is all that’s required to transfer ownership.
- A shelf company is pre-registered with Companies House and therefore already has a history, anyone can see when a company was registered and the longevity of the company.
- When applying for a bank account, credit card or business loan it can be more favourable to have an aged company than a recently registered company.
What is the process of buying an existing company?
You will need to provide a formation agent with the following:
- The relevant form for naming a replacement director
- The relevant form for stating the location of the replacement registered office
- Payment of the amount of the formation agents' invoice
The formation agent will then provide the following items where applicable:
- A certificate of incorporation, including a change of name
- A copy of the change of objects resolution
- A certificate of non-trading to the date of purchase
- The resignations of the director and secretary
- Transfers in blank of the subscribers' shares
- A change of accounting reference date form
- Form for the return of allotments of shares
- Copies of the articles of association
- The combined register and minute book with share certificates
If you would like more information on buying a business or purchasing an off-the-shelf business please browse our company formation products or to get in touch with us, please speak to us on our live chat or use our contact form.