{"id":21848,"date":"2021-04-13T16:34:02","date_gmt":"2021-04-13T15:34:02","guid":{"rendered":"https:\/\/www.policybee.co.uk\/blog\/?p=21848"},"modified":"2024-02-16T11:14:44","modified_gmt":"2024-02-16T11:14:44","slug":"legal-obligations-for-newly-incorporated-companies","status":"publish","type":"post","link":"https:\/\/www.policybee.co.uk\/blog\/legal-obligations-for-newly-incorporated-companies","title":{"rendered":"7 legal obligations every new company needs to know about"},"content":{"rendered":"\n<p><\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"alignright size-large is-resized\"><img loading=\"lazy\" decoding=\"async\" width=\"600\" height=\"300\" src=\"https:\/\/www.policybee.co.uk\/blog\/wp-content\/uploads\/2021\/04\/filing-folders-bookkeeping-accounts-data-storage-concept_shutterstock_744158275-1.jpg\" alt=\"Newly incorporated companies must meet their filing obligations\" class=\"wp-image-21852\" style=\"width:300px;height:150px\" srcset=\"https:\/\/www.policybee.co.uk\/blog\/wp-content\/uploads\/2021\/04\/filing-folders-bookkeeping-accounts-data-storage-concept_shutterstock_744158275-1.jpg 600w, https:\/\/www.policybee.co.uk\/blog\/wp-content\/uploads\/2021\/04\/filing-folders-bookkeeping-accounts-data-storage-concept_shutterstock_744158275-1-300x150.jpg 300w\" sizes=\"auto, (max-width: 600px) 100vw, 600px\" \/><\/figure>\n<\/div>\n\n\n<p>What our friends at <a href=\"https:\/\/www.sparqa.com\/\" target=\"_blank\" rel=\"noreferrer noopener\">Sparqa Legal<\/a> don&#8217;t know about business law isn&#8217;t worth knowing.  So, we asked them to set out exactly what people need to know and the steps they need to take when setting up as a limited company.<\/p>\n\n\n\n<p>Here&#8217;s what they told us. Take it away, Sparqa&#8230;.<\/p>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Get your house in order<\/h2>\n\n\n\n<p>Just incorporated your business as a company? Then congratulations!<\/p>\n\n\n\n<p>Setting up a new company is an exciting step in any business journey and incorporation brings with it all kinds of benefits \u2013 from tax efficiencies and limiting your personal liability, to helping your business attract new types of finance.<\/p>\n\n\n\n<p>But now that you\u2019ve made the leap, there are some important legal obligations to be aware of. Especially since, in many cases, failure to meet them is a criminal offence, giving Companies House the opportunity to fine your company and its directors.<\/p>\n\n\n\n<p>Besides which, it\u2019s important to get your house in order straight away if you want to attract potential lenders, investors or buyers further down the line. Get things right from the outset and it\u2019ll save you the time and cost of having to put things right at a later date.<\/p>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\">So, what are your legal obligations?<\/h2>\n\n\n\n<p><\/p>\n\n\n\n<h3 class=\"wp-block-heading\">1. Set up your statutory registers<\/h3>\n\n\n\n<p>All companies must keep statutory registers of their directors (and their directors\u2019 residential addresses), shareholders, persons with significant control (PSCs), and any secretaries. These registers must be kept either at your registered office, at an alternative address of your choice (known as a single alternative inspection location or SAIL) or on the government\u2019s Companies House central register.<\/p>\n\n\n\n<p>It\u2019s important to keep these registers up to date because lots of people have the right to inspect them. These <a href=\"https:\/\/www.sparqa.com\/content\/company-secretarial-shares-and-admin\/document\/template-registers\/overview\" target=\"_blank\" rel=\"noreferrer noopener\">template registers<\/a> will help you to comply with your legal obligations.<\/p>\n\n\n\n<p><\/p>\n\n\n\n<h3 class=\"wp-block-heading\">2. Get your company records in order<\/h3>\n\n\n\n<p>In addition to statutory registers, you\u2019ll also need to <a href=\"https:\/\/www.sparqa.com\/content\/company-secretarial-shares-and-admin\/maintaining-a-companys-books-and-records\" target=\"_blank\" rel=\"noreferrer noopener\">keep certain books and records<\/a> on a day-to-day basis, including:<\/p>\n\n\n\n<p>\u25cf Accounting books and records (eg VAT invoices, receipts, bank records)<br>\u25cf Directors\u2019 service contracts<br>\u25cf Board minutes of directors\u2019 meetings and decisions<br>\u25cf Minutes of shareholders\u2019 meetings and shareholder resolutions.<\/p>\n\n\n\n<p>These records cannot be kept at Companies House, so make sure you establish a robust record-keeping system to keep them either at your registered office or an alternative location (SAIL).<\/p>\n\n\n\n<p><\/p>\n\n\n\n<h3 class=\"wp-block-heading\">3. Remember your filing obligations<\/h3>\n\n\n\n<p>There\u2019s certain information you must file at Companies House regularly so the public register can be kept up to date. This includes your accounts and <a href=\"https:\/\/www.gov.uk\/guidance\/confirmation-statement-guidance\" target=\"_blank\" rel=\"noreferrer noopener\">confirmation statement<\/a>, both of which need to be filed annually (even if your company isn\u2019t trading or is dormant).<\/p>\n\n\n\n<p>Certain changes or events can trigger a need to file more information, for example, if you change your directors or issue new shares. So, make sure you understand what your <a href=\"https:\/\/www.sparqa.com\/content\/company-secretarial-shares-and-admin\/document\/quick-guide-to-company-books-records-and-filing\/overview\" target=\"_blank\" rel=\"noreferrer noopener\">filing obligations<\/a> are and how to comply.<\/p>\n\n\n\n<p><\/p>\n\n\n\n<h3 class=\"wp-block-heading\">4. Update your stationery<\/h3>\n\n\n\n<p>Now you\u2019re incorporated, you\u2019ll need to update your company\u2019s stationery since you\u2019re legally required to include certain information about it. in all correspondence. That includes letters, emails, invoices, order forms and demands for payment.<\/p>\n\n\n\n<p>Make sure your stationery includes all the following information:<br>\u25cf Company name<br>\u25cf Company registration number<br>\u25cf Registered office address<br>\u25cf Location in the UK.<\/p>\n\n\n\n<p>In practice, most companies include this information as a footer on any emails or other correspondence. This <a href=\"https:\/\/www.sparqa.com\/content\/company-secretarial-shares-and-admin\/document\/email-footer-and-disclaimer\/overview\" target=\"_blank\" rel=\"noreferrer noopener\">template<\/a> can help you generate a customised email footer for your business.<\/p>\n\n\n\n<p><\/p>\n\n\n\n<h3 class=\"wp-block-heading\">5. Display your company name at your registered office<\/h3>\n\n\n\n<p>You need to display your company\u2019s full registered name at your registered office. Unless you\u2019re sharing your office address with multiple companies. This is so any visitor can easily read it, meaning it must be positioned somewhere obvious.<\/p>\n\n\n\n<p><\/p>\n\n\n\n<h3 class=\"wp-block-heading\">6. Get to grips with decision-making procedures<\/h3>\n\n\n\n<p>Check your <a href=\"https:\/\/www.gov.uk\/guidance\/model-articles-of-association-for-limited-companies\" target=\"_blank\" rel=\"noreferrer noopener\">articles of association<\/a> because these will tell you how your company\u2019s decisions should be made. If you use the default model articles, most day-to-day decisions will be made by your director(s). But certain key decisions (eg issuing new shares or changing your company\u2019s name) will need to be made by your shareholders.<\/p>\n\n\n\n<p>There are some formalities to follow when making company decisions, such as giving notice of board meetings. It\u2019s important you stick to them, since it helps avoid decisions being challenged or unwound further down the line. You might find these checklists for <a href=\"https:\/\/www.sparqa.com\/content\/company-secretarial-shares-and-admin\/document\/checklist-for-passing-a-board-resolution-at-a-board-meeting-model-articles\/overview\" target=\"_blank\" rel=\"noreferrer noopener\">director<\/a> and <a href=\"https:\/\/www.sparqa.com\/content\/company-secretarial-shares-and-admin\/document\/checklist-for-passing-a-shareholder-written-resolution-model-articles\/overview\" target=\"_blank\" rel=\"noreferrer noopener\">shareholder<\/a> decision-making processes helpful.<\/p>\n\n\n\n<p><\/p>\n\n\n\n<h3 class=\"wp-block-heading\">7. Familiarise yourself with your directors\u2019 duties<\/h3>\n\n\n\n<p>Company directors have important <a href=\"https:\/\/www.sparqa.com\/content\/directors-appointment-and-responsibilities\/directors-liabilities-and-insurance\/QA\/duties-which-directors-have-to-their-company\" target=\"_blank\" rel=\"noreferrer noopener\">statutory duties and responsibilities<\/a>. And failure to uphold them can lead to legal claims against them in person. It\u2019s therefore really important that new directors get to grips with the exact nature of their duties. Also that they understand how to apply them when they make company decisions.<\/p>\n\n\n\n<p>Directors\u2019 duties include exercising reasonable care, skill and diligence; promoting the success of the company; and avoiding situations where their personal interests conflict with those of the company.<\/p>\n\n\n\n<p>In fact, there are numerous scenarios where directors can find themselves in hot water. If there\u2019s an accusation of wrongdoing, that\u2019s where <a href=\"https:\/\/www.policybee.co.uk\/directors-and-officers-insurance\" target=\"_blank\" rel=\"noreferrer noopener\">directors\u2019 and officers\u2019 insurance<\/a> can help by paying legal bills and compensating the aggrieved party if needs be.<\/p>\n\n\n\n<p>Taking the time to get things in order from day one will free up your time to focus on making a success of your business. And that can only help make for strong foundations from which your company can flourish into the future.<\/p>\n\n\n\n<p>If you want to know more about directors&#8217; and officers&#8217; insurance, give us a call on <strong>0345 222 5391<\/strong>.<\/p>\n\n\n\n<p><em><sub>The content in this article is up to date at the date of publishing. The information provided is for information purposes only and is not for the purpose of providing legal advice. \u00a9Sparqa Limited 2021. All rights reserved.<\/sub><\/em><\/p>\n\n\n\n<p><em>Image used under license from Shutterstock.<\/em><\/p>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>What our friends at Sparqa Legal don&#8217;t know about business law isn&#8217;t worth knowing. So, we asked them to set out exactly what people need to know and the steps they need to take when setting up as a limited &hellip; <a href=\"https:\/\/www.policybee.co.uk\/blog\/legal-obligations-for-newly-incorporated-companies\">Continue reading <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":12,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[132],"tags":[159,208,143],"class_list":["post-21848","post","type-post","status-publish","format-standard","hentry","category-small-business-advice","tag-directors-and-officers-insurance","tag-guest-posts","tag-rules-and-regulations"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\r\n<title>Legal obligations for newly incorporated companies<\/title>\r\n<meta name=\"description\" content=\"As a newly incorporated company, there are certain things you need to do to stay on the right side of company law. 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