UK Ltd. company formation

June 3, 2008 12:34 AM

Why would I pay an accountant £300 for UK limited company formation when there are services out there that do it for a tenth of the price? Help me cross the i's and dot the t's.

Obviously, I'd rather spend no more than necessary, but that's secondary to making sure the process is completed properly. Any other insights are welcome.

posted by nthdegx to work & money (5 comments total)

I've used quickformations many times without any issues.
posted by rus at 1:06 AM on June 3 [1 favorite]

You can certainly do it for much less than £300. I can't remember which service I used (4 years ago), but it was just one of those boilerplate ones. They provide a generic set of 'Memorandum and Articles' which you can adapt - in most cases business just define themselves as 'carrying out general business' rather than specifying their activities anyway. Other than that you just fill in a few Companies House forms about names of director/s and their share allocation, plus naming a company secretary.

One issue is if you need a registered office (it can be the same as your trading address, but only if you have a proper business premises) - if you're just running a business from home, there could be complications with council tax or your mortgage lender. You can pay about 50 quid a year to a registered office service, which will put up the official documents on its wall (along with hundreds of others) and forward any mail that Companies House or the Inland Revenue have for you.

An accountant's a good idea for looking over your actual books and helping with tax etc, but I can't see what's vital for the actual setup stage, unless you have a business with very specific needs in its financial structure.
posted by hatmandu at 2:16 AM on June 3 [1 favorite]

I've got a small business in The UK, and used Companies Made Simple to setup the entity.

They've segmented their product offerings rather well, so you can get an entity established for as little as £24.99

As hatmandu mentioned, you might have need of a registered address and they'll provide that service as well (basic Inland Revenue documents included in the cost).

We've been doing rather well, so we're now looking at adding a lot of the other services. For that £300 we'll not only have the business entity, but full secretarial telephone service, and a lot of other services.

I think its the usual trade off - your accountant has a minimum that she/he charges for this service. £300 is either it or close to it. Wouldn't surprise me if the accountant charged £300 but used one of these services to form the entity.
posted by Mutant at 2:25 AM on June 3 [2 favorites]

Further to what mutant says, you'll generally find solicitors and accountants charge way above the basic rates for services like this as they're not very interested in them. (For example I got a specialist will writer to make wills for £70, whereas friends of mine got stung £500 for an inferior service by a solicitor.)
posted by hatmandu at 2:35 AM on June 3 [1 favorite]

Thanks, guys. All very useful. I was leaning towards the accountant, but now my mind is made up the other way. Terrific stuff.
posted by nthdegx at 11:44 PM on June 3