Becoming a registered company

[Pete Williams]

Hi


My business currently trades as a partnership, we have attracted investment and to protect all shareholders we have decided to go LTD. Firstly, how easy is it to change from partnership to registered?

As a partnership we trade under a range of different brands, would all of these seperate areas need to be registered seperately or could I have an umbrella company name and just say that the other areas are a trading name of of XYZ LTD?

As a partnership we invested quite a lot of money can this be reflected in share distribution when registering?

Any help would be really appreciated.

 

[bwglaw]

You should seek advice from an Accountant to assess your current tax situation as to whether forming more than one Ltd Co is an advantage for you. It is not necessary to form a Ltd Co for each brand name or trade name that you use but you must make clear on all official documents the correct name of the Ltd Co.

Eg: We have a specialist area of work called 'Hands On Access' and the Ltd Co is Hands On Solutions UK Ltd. This is made clear on letterheads, invoices etc and we also state that 'Hands On Access is a trading name of Hands On Solutions UK Ltd' or along those lines.

We have thought about changing Hands On Access into a seperate Ltd Co and we plan to do this in Oct because we are expanding.

First I advise you to form one Ltd Co before going on to forming sister Ltd Co etc. It all depends on the size of the business.

 

[Ozzy]

As you have investors involved this isn't quite cut and dry as starting a regular Limited company, and yes discuss it with your accountant.

As you have investors, if their interest is in the whole "group" (I will use group to describe the different areas of your business) then a single company should be fine and you just trade with different trading styles. However, if your investors have put money into your business and are backing specific ventures within your group then it may be prudent to setup separate companies for each business activity you have an investor in. That way its crystal clear who owns what part of what venture when people start wanting a slice of the cake.

Yes, your existing time, effort and investment do count towards your equity stake your entitled to, especially if the company attracts an eliment of goodwill - but the amount depends on your negotiations with your investors.

 

[VeryMark]

You can use any trading style you like or trade under as many different brands as you want, as long as the full limited company name is also displayed on all business papers:

"All business letters, written orders for goods or services to be supplied to the business, invoices and receipts (including till rolls) issued in the course of the business and written demands for payment of debts arising in the course of the business."

You also have to comply with the Companies Act rules requiring you to display the full company name, number and registered office address in the appropriate places.

Don't forget that the only effective protection for any trading style or brand is trade mark registration - company name registration affords no legal protection against the use or registration of a similar name - or even the use of an identical name!

Be warned too against any so-called "business name registration" - anybody offering this is seeking to sell you a worthless service of their own invention.