Category: Starting a business articles

By Shirley Borrett, Development Director at Telework Association &
Author of Lawpack’s Working From Home Kit

Increasing numbers of people work from home including freelancers, employees and self-employed people running their own businesses. The benefits from working from home to both individuals and organisations are becoming better recognised and understood in the corporate world. Working from home is no longer automatically seen as an excuse for skiving and watching daytime television.

But working from home presents a lot of challenges and if you want to do it successfully there are some things you need to consider before starting your job search or trying to convince your boss of the benefits of working from home.

Working From Home Tip #1: Understand yourself

To work from home you need to recognise what you’re good at and what you struggle with in two areas. Firstly work tasks – the things that you’re confident you can do independently, without help or supervision are the tasks to assess for home working, as they’re the ones you’re likely to be most successful with. Those tasks that you are less sure about will be more of a challenge – that doesn’t mean you can’t do them at home, but you need to think about what support you’ll need and how you’ll get it.

You also need to think about how you work and how organised you can be. Whether you’re self-employed or you’re an employee, working from home means you have to manage yourself. You’ll have a lot of flexibility over when and how you do things but that means that you have to actually take control. You need to be good at planning tasks, organising your time, meeting deadlines and coping with unexpected problems. Enthusiasm for your work is a big help. If you’re a person that needs a push from your manager or colleagues to get on and do things, if you need someone else to tell you what to do next, then you’re likely to struggle with working from home.

Working From Home Tip #2: Have a suitable place

When you’re working from home you ideally want a place to work that is sufficiently separate from your home life to enable you to think of it as being ‘at work’. A study, spare bedroom or garden building means that you can shut the door and concentrate on work, or shut the door behind you and forget about work. It means your children, pets and spouse are less likely to interrupt you and your work will not take over family areas. If you don’t have somewhere you can dedicate to work you may be able to find a reasonable alternative, but the challenges will be even greater, so think carefully about exactly how you’ll provide the space, facilities and atmosphere that you’ll need to work from home.

Working From Home Tip #3: Involve your family in decisions

Working from home will have an impact on anyone that you share your home with. Make sure you explain why you want to work from home and how it will benefit the whole family. Talk about the difficulties of working from home too and come to a mutual agreement about how available or otherwise you’ll be to help out with domestic matters. For instance, taking or collecting children from school and dealing with deliveries.

Working From Home Tip #4: Keep motivated

However much you like your work there will be times when you have real trouble getting going or keeping at it. Before you embark on home working, work out how you’ll maintain your enthusiasm when things get tough. Understand yourself and how you react to pressure and make sure you know what to do to stop yourself sliding into apathy and inactivity.

Working From Home Tip #5: Stay in touch

People worry about isolation when they start working from home and, although this worry is usually unfounded, it’s important to make the effort to keep in touch right from the beginning. If you’re an employee, then your manager should make sure you’re included in all the team communications and activities. It can be especially helpful to be in contact with other employees working from home. Social networking like instant messenger can make a good substitute for the ‘coffee machine chats’ that just happen in an office environment.

If you’re a freelance or self-employed, then look for networks of similar people that you can meet up with, either in the local pub or online.

Working From Home Tip #6: Switch off – take a break

People working from home are usually more productive than when they are office based, and much of this is due to motivation and lack of interruptions. But, when your work is just a step away rather than an hour’s journey away, it is easy to carry on working indefinitely. Productivity deteriorates when you’re tired whether you’re at home or in the office, and sitting staring at a computer screen for hours is bad for you wherever you are. So make sure you take regular breaks during the day and that you do finish work, switch off and close the door (even if that’s a mental door rather than a physical one).

It’s one thing to recognise that you’re a night owl and are most creative in the evenings, so long as you take time to relax in the morning or middle of the day to compensate. Working through the whole day and then late into the evening will soon exhaust you and wipe out the benefits of flexibility and home working.

And taking a break also applies to holidays. As an employee you should be able to schedule holiday breaks just like everyone else. But if you’re self-employed, getting away can be much more difficult. Try and take a break during a quiet part of the year and/or link up with someone else working in your field and arrange to cover essential work for each other whilst you take holidays.

Burying yourself in day-to-day operational problems is not good for your business – you need to step back sometimes and look at the big picture to ensure you’re going in the right direction and a holiday is the ideal time to do that.

Hopefully you feel positive about tackling these work from home challenges. So, if you want to try it, you’ll need to think about your next steps. These include actually setting up your home office and looking more closely at your skills. Also thinking about the legal and regulatory aspects of working from home. And then finding genuine home working opportunities or convincing your boss to let you start working from home. Expert guidance on all these matters can be found in Lawpack’s Working From Home Kit.

Related Links:

• Six steps to setting up your home office
• 5 reasons why home working is good for business

Related Products:

• Working from Home Starter Kit
• Working from Home Guide
• Running Your Own Business Made Easy
• Starting Up and Running Your Own B&B

Published on: January 21, 2011

Once you know the name of your limited company – the name(s) of its shareholders and the name(s) of its directors – you’re now ready to form your limited company.

Here’s a list of the company formation forms you need to form a limited company.

All of these company formation forms must be completed and then you must register your limited company at Companies House. Remember that you must be consistent with wording when referring to your limited company name on all documents filed at Companies House. Choose ‘Limited’ or ‘Ltd’, but don’t use both.

Memorandum of Association

The Memorandum of Association simply sets out the name of the limited company and who the initial subscribers (shareholders) are.

You must complete the name of the limited company and the names and signatures of the subscribers. This must be sent with Form IN01 to Companies House.

Articles of Association

The limited company’s constitution is known as its Articles of Association. Articles of Association contain the company’s regulations for its internal management.

The official title of this document used to be Table A but it’s now called ‘Model Articles’.

If you adopt the Model Articles, you don’t need to submit the limited company’s proposed articles but you should indicate on Form IN01 that you have adopted the Model Articles. Just because you have adopted the Model Articles, this doesn’t mean you can’t amend them but, if you do, you must pass a special resolution and notify Companies House within 15 days.

Lawpack’s Articles of Association is to be used when forming a private limited company by shares.

Application to Register a Company Form IN01

Form IN01 gives details of the limited company directors, company secretary and the address of the limited company’s registered office. It also states that the limited company directors have complied with all proper procedures to form a limited company.

For those of you familiar with the old limited company formation forms, this Form IN01 replaces Form 10 and Form 12, and is the new ‘master’ form for incorporating your limited company. Although the new form is considerably longer than Form 10 and Form 12, due to the extra detail required, it’s likely that a continuation sheet of sorts will be required (and this sheet is provided as a download when you purchase our Limited Company Formation Kit).

Here is an outline of what needs to go where, who needs to sign what, and we also aim to highlight the more important parts of Form IN01:

Part 1 – Company details

This is where you enter the limited company’s name and its first registered office. You will also need to confirm the limited company type and confirm that the limited company name does not have any ‘sensitive’ words.

It’s highly unlikely that you will need to tick the box so as not to include ‘Limited’ in the name. If you do want to do this, you should contact your accountant.

Also in this section of Form IN01, you must indicate what type of Articles of Association will be used. Most new companies will use the Model Articles in its entirety and tick ‘private limited by shares’ in option one. But if you require option two or three, or the Articles will be restricted, you should contact your accountant or solicitor.

Part 2 – Proposed officers

Companies House distinguish between corporate and non-corporate directors and company secretaries. Company directors and company secretaries now have more protection as they can select to use a service address rather than their residential address to show on the limited company register and at Companies House.

The company secretary (if there is one after 6 April 2008) must sign and date Form IN01. The directors must also sign and date Form IN01.

Part 3 – Statement of capital

This section of Form IN01 is where the limited company’s share capital is noted. It’s also where the share types and values are entered. The Companies Act 2006 has removed the need for an authorised number of shares and only requires a note of the issued share capital.

The standard class of share capital is known as ‘ordinary shares’ and they normally have a value of £1 each for private limited companies. It’s sensible that all shares are paid in full as if they are not, the limited company or its administrators could chase for the remainder at a later date.

The number of shares that the limited company has is up to you, but it’s usual to have a few hundred shares. We would not recommend a value of over £4,000 as this may close avenues when you want the limited company to dissolve.

You can also specify in this section of Form IN01 any specific share rights, for example, the ordinary shares above could have voting rights and the right to receive a dividend, whereas another class of share may only have the right to receive a dividend but no voting rights. If so, you will need to enter the particulars for each non-normal share type on Form IN01.

Part 4 – Statement of guarantee

This section of Form IN01 only relates to limited companies that don’t have any share capital. If your limited company does have share capital, then this section of Form IN01 can be ignored.

Part 5 – Statement of compliance

In this section of Form IN01, each subscriber must sign Form IN01 to confirm all the information on the form is correct. It’s also advisable to complete the ‘Presenter information’ section in case Companies House have any queries. We would suggest that each is completed to avoid any rejections.

Finally, after completing the form you will need to send Form IN01, along with the necessary payment, and Memorandum of Association plus copy Articles if you’re not using Model Articles, to the registrar at Companies House.

Make sure to take copies of Form IN01 before sending off the originals, as Companies House charge for issuing copies of submitted documents.

The registrar will then send you a Certificate of Incorporation. The limited company comes into existence from the date on this Certificate which will also show the Company Number and where it’s registered.

Congratulations! You have now registered and formed a limited company.

Related Articles

• 12 company resolutions to make after limited company formation
• Issuing shares and share certificates
• Issuing shares and share capital – Q&As

Related Products

• Ready-Made Company Minutes & Resolutions
• Limited Company Formation Kit
• How to Run a Limited Company Guide

Published on: October 11, 2010

Once you’re ready to set up your limited company, it’s time for you to name the limited company and then determine whether you’re allowed to use that company name.

But beware the following rules for naming limited companies:

Naming a limited company – Rule #1

When naming your limited company you must include the word ‘Limited’ at the end of it.

If you’re incorporating a company in Wales (i.e. its registered office is in Wales), the name may be written in either English or Welsh. The Welsh word for ‘Limited’ is ‘Cyfyngedig’. You can also use the abbreviations ‘Ltd’ or ‘Cyf ’.

Naming a limited company – Rule #2

Don’t use a company name that is identical or similar to one which is already on the Limited Company Register at Companies House.

For example, ‘Lawpack Publishing Limited’ and ‘Lawpack Publishing Company Limited’ would be considered the same.

With ‘Lawpack Publishing Limited’ and ‘Law Pak Publishing Limited’, for example, the names would not be refused initially, as they’re not identical. But Law Pak Publishing Limited may have to change its name if there was a successful objection from Lawpack Publishing Limited.

Naming a limited company – Rule #3

Don’t use a company name that is offensive or would constitute a criminal offence.

Naming a limited company – Rule #4

Don’t use a company name that is so misleading as to the activities of the limited company that it causes harm to the public.

Naming a limited company – Rule #5

Don’t let your company name give the impression that the limited company is connected with HM Government or a local authority.

Naming a limited company – Rule #6

When naming your limited company make sure that the company name doesn’t include any sensitive words or expressions, such as:

• Association
• Assurance
• Assurer
• Authority
• Benevolent
• Board
• British
• Chamber(s) of Commerce
• Chamber(s) of Trade
• Charter
• Chartered
• Chemist
• Chemistry
• Co-operative
• Council
• England
• English
• European
• Federation
• Foundation
• Friendly Society
• Fund
• Government
• Great Britain
• Group
• Holding
• HSC (Health and Social Care)
• HPSS (Health and Personal Social Services)
• Industrial & Provident Society
• Institute
• Institution
• Insurance
• Insurer
• International
• Ireland
• Irish
• National
• Patent
• Patentee
• Post Office
• Reassurance
• Reassurer
• Register
• Registered
• Reinsurance
• Reinsurer
• Scotland
• Scottish
• Sheffield
• Society
• Stock Exchange
• Trade Union
• Trust
• United Kingdom
• Wales
• Welsh

If you have any doubts about your choice of company name, consult Companies House where you can check the index of Company Names. You can also consult the Trade Marks Register of the UK Intellectual Property Office at www.ipo.gov.uk.

Related Articles

• The dos and don’ts when using your limited company name
• Choosing the right type of limited company to form

Related Products

• Limited Company Formation Kit
• How to Run a Limited Company Guide
• Adoption of Trading Name
• Ready-Made Company Minutes & Resolutions

 

Published on: October 11, 2010

Limited companies exist as a legal entity in their own right, so the limited company’s finances are separate from the personal finances of their business owners.

Shareholders can be individuals or other companies. They’re not responsible for the limited company’s debts, unless they have given guarantees (of a bank loan, for example). But they may lose the money they have invested in the limited company if it fails.

Here’s a breakdown of private limited companies and public limited companies:

Limited company #1: Limited company by shares

A limited company by shares is the most well known type of limited company and is commonly used for a small business. The limited company issues shares and the profits can be distributed to shareholders as a dividend.

The shareholder’s liability in a limited company by shares is limited to the nominal value of the shares held by the shareholder. If the shareholder agrees to pay more than the nominal value, their liability is for that greater sum. Provided that the limited company is successful, the value of the shares should increase but if the limited company goes into liquidation, the shareholder can lose this investment.

Find out more on how to form a limited company by shares.

Limited company #2: Limited company by guarantee

A limited company by guarantee is usually used by “not for profit” organisations, such as clubs or charities. A limited company by guarantee doesn’t issue shares and profits are not distributed to the members.

The member’s liability in a limited company by guarantee is limited to an amount the member has personally guaranteed to contribute to the assets of the limited company if it’s wound up, and this guarantee also applies for a period of one year after membership has ceased.

Limited company #3: Public limited company

The shareholder’s liability in the PLC will be limited to the nominal value of the shares held by the shareholder. If the shareholder has agreed to pay more than the nominal value, the liability is for that greater sum.

When the public limited company is first incorporated, the PLC’s name and Memorandum of Association must specify that it’s a public limited company. The statutory rules which a public limited company must comply with are stricter than those which apply to private companies.