There have been a great number of changes in company and partnership law over the last few years.
A lot of these changes have been with the aim of making it simpler and more straightforward for businesses to be managed and operated as limited companies and limited liability partnerships.
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Therefore now is a good time to review whether your business is taking advantage of these changes and its existing structure meets the owners’/managers’ requirements.
Here’s our top housekeeping tasks to consider:-
- Check your company’s records at Companies House are up to date by reviewing its filing history for free at the Companies House website.
- Make sure you have the necessary details to allow you to file documents with Companies House electronically, rather than by post.
- Locate the company’s statutory registers (usually a lever arch file which includes a legal record of the company’s ownership) and check they are up to date.
- Download a copy of your company’s current memorandum and articles of association (the company’s internal rules and constitution) for review.
- If your company was established prior to 2009, its articles of association are likely to be based on a form which doesn’t reflect current company law, particularly regarding share capital and the approval of directors’ conflicts of interest.
- Look at whether your company’s articles of association reflect the way in which it actually operates on a daily basis, to avoid the risk of directors’ decisions being challenged at a later date.
- Consider amending the company’s articles of association to include rules/procedures to be followed where a shareholder wishes to transfer his or her shares. This will avoid any disputes at a later date.
- Check that the company has appropriate delegated authorities in place so that directors and employees have clear processes to follow and that a company signatory will always be available.
Limited Liability Partnerships
- Do you have an up-to-date limited partnership agreement among the members?In the absence of an agreement, the law provides for a default set of rules which may not suit the members’ requirements.
- Do you have an up-to-date partnership agreement among the members? As with LLPs, in the absence of an agreement the law provides for a default set of rules which may not suit the members’ requirements.
- Consider the benefits of incorporating your business as a company or LLP – particularly the benefit of limited liability for the business owner – and whether these will outweigh the increased regulatory burden, such as the need to file accounts. Ensure you take tax advice on the impact of incorporation.
This is a sponsored post by Brodies LLP.
Brodies provides advice on all aspects of company and partnership law. For further advice, contact Alasdair Dunn at Brodies LLP.