Wisteria news category: Starting a business

Holding companies and subsidiaries

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Broadly speaking, a “group” is a family of companies linked by their shareholdings in each other. A company which is controlled by another is known as a “subsidiary” company while a company which controls another is termed a “holding” company. Groups are usually formed in order to take advantage of the increased level of limited liability, to achieve greater flexibility of business administration or due to tax reasons and circumstantial necessities. Read full article »

Issue and allotment of shares

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What is the difference between an issue and an allotment of shares?

The issued and allotted share capital of a company is the total amount of share capital that is actually in the hands of shareholders. “Issue” and “allotment “are used to describe the process of granting new shares in a company. Read full article »

Do you need a company secretary?


It is not compulsory for private companies to have a company secretary. Many private companies opt to have a director to carry out the secretarial functions, which can be cost-effective for small companies. It is important to know that where a company chooses not to have a company secretary, all reference to the company secretary should be removed from its articles and company paperwork. Read full article »

What is a dividend?


“Distribution” is the general term used to describe a payment made by a company to its shareholders based on their shareholding. A “dividend” is a distribution of a portion of the company’s earnings to a class of its shareholders. Usually, in smaller companies in which the shareholders are also the directors, a regular dividend is paid, because dividends can be more tax-efficient for both the company and the recipient. In larger companies, however, shareholders expect to be able to participate in the company’s profits. In this article I will outline the different types of dividends and will answer the most frequently asked questions. Read full article »

Trading Names (Trading as…)


The name a company registers at Companies House is referred to as its ‘company name’ and the one it trades under as its ‘trading name’. In an effort to prevent companies from disappearing behind different names, statute imposes requirements on the use of both types. In this article, I will focus on what trading names actually are and the regulations that govern them. I will then inform you on how to protect your company name and will raise your awareness of sensitive names. Read full article »

Top 4 things you need to know about the role of Company Directors


A company is a legal person and thus the individuals forming part of it must undertake its management by making decisions. Shareholder’s investment enables the company to exist, however, the directors are responsible for the day-to-day business of the company. Here are The Top 4 things you need to know about Company Directors, which will increase your knowledge and will give you a head start for a successful business. Read full article »

Shares and Share capital


Shares are a form of company funding and can be held in the two most common types of company: private and public companies limited by shares. Shareholders get shares in return of investing in a company. These shares carry particular rights, the exact nature of which is defined by the “class” of the share and the company that issues them. Read full article »

Sole Trader vs. Limited company

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Choosing the legal structure of your business is one of the most important decisions one should make when forming a company. The structure is of a pivotal importance as it defines your legal, financial and personal responsibilities as well as the amount of taxes you are required to pay. Read full article »

Should I register for VAT flat-rate scheme?


The flat-rate scheme is an optional VAT scheme designed to reduce the administrative burdens for small businesses. Unlike the standard VAT accounting, the flat-rate scheme saves time by shortening the process of recording VAT on sales and purchases. Read full article »

Business bank account

Many new companies in the UK, particularly those set up by non-residents, struggle to open a business bank account. It is a common misconception that a UK company must have a UK business bank account. There is no legal requirement for a company to have a business bank account at a UK bank. If you struggle to open an account in the UK you could open a business bank account in your home country or you could use a PayPal account to accept payments. It is important to keep business and personal transactions separate. Read full article »