The Companies Act has many safeguards for your protection, and all limited companies are now formed in accordance with its provisions. By law a limited company is a separate legal concern, quite distinct from its shareholders and directors. The director and the company, therefore, have quite separate rights and separate existences, meaning more protection for you.
What is a Limited Company?
A limited company is a legal business structure that is registered with Companies House. A limited company is seen as an individual, in the eyes of the law. Thus, a limited company is a separate individual from its owners: it is responsible for its own actions, finances and liabilities.
Different Types of Limited Companies
A business name or partnership is (by law) an association of the partners and has no separate existence from them.
There are different types of limited companies that can help save any fundamental bearing on the rights and duties of the persons involved in a business venture:
- Private Limited by Shares (LTD)
- Private Limited by Guarantee (LTD)
- Limited Liability Partnership (LLP)
- Public Limited Company (PLC)
How Can Registering as a Limited Company Help You?
Notably, a limited company can help you in the instance of business failure and in the instance of business success, by reduction of tax. Additionally:
- It can allow business owners to benefit from company profits without personal liability.
- A limited company is a separate entity from its owners, meaning everything from the company bank account, to ownership of assets and involvement in tenders and contracts is purely company business and separate from the interests of the company’s shareholders.
- A more professional image is given of the company.
- It can protect you company name by law - once you register your company with Companies House no-one else can use the same name as you, or anything deemed to be too similar.
Need Some Guidance?
For more information on personal protection and Paramount Company Formations, call our friendly team on 0800 0198 698 or contact us online.