Glossary
| Word | Definition | |
|---|---|---|
| A | Accounting Period | The time covered by your accounts or Company Tax Return. |
| Accounting Reference Date | This is the last day of your company's financial year - the date that your accounts should be made up to. | |
| Activation Code | A 12 digit numerical code provided by HMRC to access the Corporation Tax online service. | |
| Active | A company that is registered at Companies House and trading or receiving an income. | |
| Administration | When a company becomes insolvent and is put under the management of licenced insolvency practitioners. | |
| Alternative Director | Alternative directors are often appointed to attend a board meeting in place of another director but can only act on the specific director’s behalf for as long as they are appointed. | |
| Annual Accounts | Statutory report detailing financial activity. | |
| Annual General Meeting | A yearly gathering of a company's shareholders where they are presented with a report of the company's performance and strategy for that year. | |
| Annual Return | Former name for the Confirmation Statement. The name changed in 2016 but the function and purpose remains the same. | |
| Anti-Money Laundering (AML) | Due diligence that must be carried out to prevent fraud and money laundering by verifying the identity of those involved in registering a company. | |
| Apostilled Documents | The process of legalising a document by attaching a stamped official certificate. | |
| Articles of Association | A company registration document that outlines how the company should be run and the responsibilities and powers of directors and shareholders. | |
| Asset-Locked Body | A charity or community interest company nominated by a CIC to receive dividends and be awarded the CIC's assets should the company close. | |
| Association of Company Registration Agents (ACRA) | The only professional membership organization for formation agents to encourage high standards and acts as an open forum for those in the industry. | |
| Auditor | A person or company authorized to examine and verify the accuracy of financial accounts. | |
| Authentication Code | A six-digit alphanumerical code used for filing a company's documents online. | |
| B | Balance Sheet | A financial statement that reports a company's assets, liabilities and shareholder equity. |
| Beneficial Owner | Any individual or company that:
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| Board of Directors | The collective term for the company directors. | |
| Business Address | The address where a company receives general correspondence from banks, customers, suppliers, and other business contacts. | |
| Business Starter Pack | Our ultimate guide walking you through the steps required to start your own company. Read more here: Business Starter Pack. | |
| C | Certificate of Good Standing | A certificate from Companies House confirming the details held by them at the time of issue. This is usually requested by a company to confirm to a third party that the company is in good order. |
| Certificate of Incorporation | A certificate provided by Companies House confirming the company name, registration number, and the registration jurisdiction. | |
| Certificate of Incorporation on Change of Name | A certificate provided by Companies House confirming a company name change and the date of the change. | |
| Certified Documents | A professional person confirms that a document is a true copy of the original and signs their approval. Documents that are confirmed by a professional as true copies of the original | |
| Chairman | A person presiding over a meeting. | |
| Charity Commission | Non-ministerial department of the Government that regulates and registers charities in England and Wales. | |
| Charitable Incorporated Organisation (CIO) | A corporate body that is not a company incorporated under the Companies Acts and is registered with the Charity Commission. | |
| Chartered Accountants | Accountants who have undertaken years of training and exams, and committed to continuous professional development, bound by the ICAEW's Code of Ethics and disciplinary procedures. Required to hold a practicing certificate and professional indemnity insurance unlike unqualified accountants. | |
| Community Interest Company (CIC) | A not-for-profit company registered to benefit the community rather than private shareholders. | |
| Companies Act 1985 | Learn more | |
| Companies Act 2006 | Incorporations are now incorporated under this piece of legislation. | |
| Companies House | The Registrar of Companies responsible for incorporating and dissolving companies and maintaining a register for all companies registered in the UK. Part of the Department for Business, Energy, and Industrial Strategy. | |
| Companies House Register | An extensive catalog of all companies and LLPs registered within the UK, and the information of the officers and activities. | |
| Company Fact Sheet | Our detailed document providing you with the important registration details and dates you will need to be aware of upon incorporation of your company. Included with all physical incorporation documents. | |
| Company Name | The legally registered name of a company or LLP. | |
| Company Officers | A collective term for directors, partners, and company secretaries. | |
| Company Seal | A handheld embossing tool featuring the company name and registration number. These are usually used for contracts or agreements, however, they are not a legal requirement as this was abolished in 1990. | |
| Company Secretary | An individual appointed to support the directors with administration and compliance. The secretary can also be a director but cannot be the company's auditor or bankrupt. | |
| Company Tax Return (CT600) | An annual filing requirement for actively trading companies reporting the spending, profits, and Corporation Tax due to HMRC. | |
| Confirmation Statement (CS01) | An annual filing requirement to verify that the company's information is up to date with Companies House. | |
| Consent to Act | The confirmation of a prospective director or secretary, verifying that they agree to be appointed into the corresponding role. | |
| Corporate Director | A company appointed as a director. Companies House is seeking to ban corporate director appointments so these will soon cease to be accepted. | |
| Corporate Secretary | Another company appointed as secretary to support the directors with administration and compliance. The secretary can also be a director but cannot be the company's auditor or an 'undischarged bankrupt' unless permission is granted by the courts. | |
| Corporate Shareholder | A company that holds shares in another company. | |
| Corporation Tax | Tax paid on the taxable profit made by a company. The current rate is 19% tax. | |
| D | Date of Incorporation | The date that Companies House approve the registration of the company. |
| Department for Business and Trade | A government department that oversees Companies House. Formerly the Department for Business, Energy and Industrial Strategy (BEIS). | |
| Designated Member | Officer of an LLP with greater duties and responsibilities than an ordinary LLP Member. | |
| Director | An individual appointed by shareholders to manage the company's daily activities. Can also be more generally known as an officer of the company. | |
| Disqualification Register | A register of all individuals who have been disqualified from acting as a director. | |
| Disqualified Director | An individual who has been banned from acting as a director or being involved in running a company due to failing to comply with their duties or the terms of a previous disqualification. | |
| Dissolution | The process of striking a company off the register, this can be voluntary or compulsory. | |
| Dividend | A sum of money paid to shareholders from the profits of the company. | |
| Dormant | A registered company that has not yet started trading, or ceased trading but remains active on the Companies House register. | |
| Dormant Accounts | Accounts confirming no financial activity for the relevant financial year. | |
| E | Economic Crime (Transparency and Enforcement) Act 2022 | A law introduced into the UK in 2022 to combat economic crime, improve transparency within UK companies and reform the role of Companies House. |
| Electronic Company Formation | Online incorporations completed using specialist software. | |
| F | First Board Meeting Minutes | Minutes from the first meeting of the company, confirming the directors and secretary appointed along with the allotted shares. |
| Flat Management Company | A company set up to manage a property divided into a number of separate flats. | |
| Formation | The process of forming a company with Companies House. Also see: Incorporation. | |
| Formation Agent | An individual or corporate entity that registers companies on behalf of the owners. | |
| Fully Paid Shares | Shares in a company whose whole value has been paid. | |
| G | Getting Started Guide | Our comprehensive guide supporting you in registering a company. Read more here: Getting Started Guide PDF |
| Guarantors | Individuals that guarantee to pay a specified amount should a company limited by guarantee be unable to pay its debts. | |
| H | His Majesty's Revenue and Customs (HMRC) | The UK's authority on tax, payments and customs. This is a non-ministerial department. |
| Holding Company | A company set up to acquire shares in another company, these will usually have a controlling interest. | |
| I | Income Tax | A tax paid on various types of income above your personal allowance including salary, pensions and profits earned from your business. |
| Incorporation | The process of registering a company with Companies House. | |
| Incorporation Documents | Documents received upon incorporation of your company: Certificate of Incorporation, Memorandum and Articles of Association, Share Certificate, and First Board Meeting Minutes. These documents may vary depending on the registered structure. | |
| Information Commissioner's Office (ICO) | An executive non-departmental public body set up to uphold information rights in the public interest, promoting openness by public bodies and data privacy for individuals. | |
| Insolvency | The situation that occurs when a company is unable to pay its debts at the time that they are due. | |
| Intellectual Property | Something that you create using your mind - for example, a story, an invention, an artistic work, or a symbol. This can be protected through copyright, patents, designs, and trademarks. Some are automatically protected, others are applied for. | |
| J | Jurisdiction | Legal territories in the UK - England and Wales, Scotland and Northern Ireland. |
| K | ||
| L | Limited By Guarantee | A limited liability not for profit company registered for community benefit, not private profit. |
| Limited by Shares | A limited liability company owned by shareholders and registered to make private profit. | |
| Limited Company (LTD) | A private limited company, by shares or guarantee. | |
| Limited Liability | Limiting shareholder liability for company debts to the value of any unpaid shares. | |
| Limited Liability Partnership (LLP) | A partnership structure where each partner's liabilities are limited to their input into the business. | |
| London Stock Exchange (LSE) | The primary and largest stock exchange in the UK allowing public companies to offer their shares to the wider public. | |
| M | Mail Forwarding | Our service allowing you to receive all forms of correspondence to the selected registered office and service address, and have it forwarded to an address of your choosing. |
| Members | Another term for shareholders or guarantors, depending on the company structure. LLP Members are typically referred to as partners. | |
| Memorandum of Association | Contains the names of initial shareholders or guarantors and confirms their intention to start a company. | |
| N | Name Availability Checker | Our search function allowing you to confirm whether your chosen company name is available to register, or if is already registered, who you need permission from to use the name. |
| Nominal Value | The value of each individual share. | |
| Nominee Director | A nominee director is appointed to provide anonymity to business owners. Typically, a nominee director is used to avoid one’s details appearing on the public registry. | |
| Non-Resident | A company officer whose primary residence is outside of the UK. | |
| Not-For-Profit | An entity whose profits will not be used to benefit private individuals but rather those it aims to support. | |
| O | Office for National Statistics (ONS) | Independent producer of official statistics. Analyses company SIC codes to identify popular industries. |
| Office of the Regulator of Community Interest Companies | The regulatory body for CIC's that decides whether a company is eligible to become a CIC, investigating complaints against CICs and providing guidance and assistance to those looking to register CICs. | |
| Ordinary Resolution | A resolution of a company passed by a simple majority, i.e. more than 50% of the total votes cast. | |
| Overseas Entity ID (OEID) | Identification number given to overseas entities upon registration with Companies House on the Register of Overseas Entities. | |
| P | Partnership Agreement | Written agreement between business partners which sets out obligations and the business framework. Used in LLPs. |
| Pay As You Earn (PAYE) | HMRC's method of deducting tax from your salary before you receive it. | |
| Person With Significant Control (PSC) | A PSC is anyone who holds more than 25% of the shares or voting rights in the company, and they may have the right to appoint or remove a majority of the board of directors. Alternatively, anyone who has significant control or influence in the way the company is run. | |
| Prescribed Particulars | Details of the rights attached to shares. | |
| Profit | A financial gain, the difference between the company's income and expenditure. | |
| Public Limited Company (PLC) | A limited company permitted to offer its shares to the general public. | |
| Q | Quorum | The minimum number of members required to make decisions in meetings. |
| R | Register of Overseas Entities (ROE) | Register held by Companies House of overseas entities that own land or property in the UK detailing the beneficial owners and/or managing officers. |
| Registered Office | Official address of a limited company for correspondence purposes. A legal requirement for all companies and must be within the same UK jurisdiction within which the company was registered. | |
| Registration Number | An 8 digit number given to a registered company. For LLP's this number will begin with OC followed by 6 numbers. | |
| Relevant Registrable Legal Entity (RRLE) | A corporate entity that qualifies as a PSC for a company in the same way an individual does. | |
| Required Ending | The legally required ending for a registered name, e.g., Ltd or Limited, PLC, LLP or CIC. | |
| Residential Address | Your primary residence address, there is no requirement for this to be in the UK. | |
| Resignation | The act of removing one's self from their appointed position. | |
| Resolutions | Legally binding decisions made by the shareholders of a company. | |
| Restoration | The process of reopening a previously closed company. | |
| Right to Manage Companies (RTM) | Limited by guarantee companies which allow long leaseholders in blocks of flats to take over the management of their building. | |
| S | Secretary | A company officer appointed to support directors with company maintenance, meetings and filings. The secretary can also be appointed as a director but cannot be the company's auditor or an undischarged bankrupt. |
| Self Assessment | A self assessment tax return allows sole traders and businesses with other income (e.g. grants and support schemes) to report their earnings for Income Tax purposes. This must be filed by 31 January of each year. | |
| Sensitive and Restricted Words or Expressions | Designated words or expressions that require permission from particular government departments or external organisations to be used. | |
| Service Address | Correspondence address for any director, secretary, or PSC. | |
| Share Allotment | The process of issuing shares to shareholders. | |
| Share Capital | The amount of money invested into a company. | |
| Share Certificate | A certificate issued upon the allotment of shares, indicating the share certificate number, the shareholder and their address and how many shares they hold. | |
| Share Class | A designation applied to shares, companies typically use Ordinary shares. Those wanting to vary the rights attached to the shares may opt for alphabet shares (A, B, C). | |
| Shareholder | A person that owns shares in a company. | |
| Shares | A unit of ownership in a company. | |
| Shelf Company | A company registered to 'sit on the shelf' until purchased. Useful for those who want an older incorporation date. | |
| Single Alternative Inspection Location (SAIL) | An optional alternate address to the Registered Office Address where company records can be inspected. | |
| Sole Trader | A self-employed individual registered with HMRC operating an unregistered business. | |
| Stamp Duty | A tax the government imposes on certain legal documents, usually involving the transfer of property or other assets (e.g. stock transfer). | |
| Standard Industrial Code (SIC) | A five-digit numerical code to identify the economic business activities of the company. A company must have at least one code with a maximum of four. | |
| Statement Date | The date that your Confirmation Statement should be made up to, it should then be filed within two weeks of this date. | |
| Statement of Capital | Confirms the details of a company's share capital at a given time. | |
| Statutory Mail | Mail that is issued by Companies House, HMRC, and other government agencies or the courts. | |
| Statutory Registers | Registers companies are legally obliged to maintain, including registers of: members, PSC's, directors, directors' usual residential addresses, secretaries and Information as to state of central register. | |
| Subscriber | Shareholders who agree to form and become part of a company by subscribing to the memorandum of association during the company formation process. | |
| T | The Gazette | An official public record containing notices placed by registered and verified persons acting in an official capacity. The Gazette is a combination of The London Gazette, The Belfast Gazette and The Edinburgh Gazette. |
| Trading Address | The address from which a company conducts its business. | |
| Transfer of Shares | The process of transferring ownership of shares from one shareholder to another (new or existing). | |
| U | UK Regulated Agent | An individual or corporate entity, supervised under the Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017 and permitted to complete verification checks on beneficial owners of an overseas entity. |
| Undischarged Bankrupt | Someone who is legally bankrupt but who still has to pay back particular debts and cannot borrow again without telling financial organisations considering a loan that they are bankrupt. | |
| Unique Taxpayer Reference (UTR) | A 10 digit code assigned to every company and required to communicate with HMRC with regards to Corporation Tax, and to file the Company Tax Return. | |
| Unlimited Company | A company with no limited liability protection. Shareholders will be liable for all company debts, placing their own personal assets at risk. | |
| V | Value Added Tax (VAT) | Flat rate tax levied on goods and services currently at 20%. Some items receive a reduced rate or are zero rated. |
| W | WebFiling | The Companies House online filing service. |
| Written Resolution | A document circulated to shareholders or directors that describes the resolution (or decision of the company) and allows them to sign and confirm their agreement. | |
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