Companies House

A company and a corporation are the same thing. A company can have just one member and can be deemed to have existed since time immemorial. The Archbishop of Canterbury is said to be a corporation sole and the office and the current office-holder are distinguished by this device. If you leave money to the Archbishop in your will, it is not going to be pocketed by any one individual.

A company can be created by Royal Charter, with the British East India Company being a famous historical example. It can be specifically created by Act of Parliament, such as the Channel Four Television Corporation Limited. At one time the Royal Charter and the Act of Parliament were the only ways to set up a company.

Starting with the Joint Stock Companies Act 1844, it became possible for private individuals to form and register a company. The Limited Liability Act of 1855 allowed these companies to have limited liability, which means that the private investor can now invest and stop worrying. You might lose your investment if you get sued, but you won’t lose your house.

The last Companies Act was in 2006, and many companies have been registered since then. Strictly speaking there are three Companies Acts, one for Scotland, one for Northern Ireland and the third for England and Wales as a single country. Administration of the Act is undertaken by Companies House which is located in Edinburgh for Scotland, in Belfast for Northern Ireland, and in Cardiff for England and Wales.

A consequence of this is that a company with an address in Longtown cannot easily migrate to Gretna. It can move anywhere within England and Wales, but not out of the country altogether. In order to simulate migration, there would need to be a new company set up in Gretna, and then a rather complicated exchange of shares to make the move.

The company needs to file a Confirmation Statement at Companies House every year. This is like an annual health check to see if the directors still want the company in existence, since it is not unknown for people to set up a company and then disappear. The Confirmation Statement was known as the Annual Return until recently, and filing it online costs £13.

This makes it possible to maintain a company which does nothing, as long as you are prepared to pay £13 every year. Such a company is known as a dormant company. You might want one to match the name of a website just in case you want to do something with it in the future.

The price of limited liability is that the company needs to file accounts every year. If the company is not dormant, then this is best left to a qualified accountant, but responsibility for preparing and filing accounts rests with the directors, and the accountant is just there to assist.

Most filings at Companies House are done online, but a few documents may need to be posted. It is human nature to leave things to the last minute, and sometimes we need a service like Royal Mail Special Delivery to make sure what we posted gets there on time.

The phrase “Companies Act” does not have an apostrophe (look at the text of the Act), so presumably there is no grammatical error in “Companies House”, which is what it is called.

At one time at least six people were needed to form a company, as if it were a kind of cooperative. Today a company can have a single shareholder, a single director and no company secretary.