A legal structure suitable for not-for-profit organisations such as social enterprises, community interest companies, charities, membership associations, and clubs. 

It protects members from personal liabilities by setting a limit on what members are willing to risk.  

This type of structure does not have share capital or shareholders. Appointed Guarantors are those members that undertake to contribute a sum of money to cover the company’s obligations should the company becomes insolvent or is wound up. This is typically a small amount eg £1.00. 

There must be at least one director and a member appointed, chosen from the within the organisation and the community. Directors are usually appointed to manage the company through a democratically operated, Management Committee or Board of Governors. Whilst not strictly prohibited, shareholders may be restricted from receiving a share of the profits through regulations placed in the memorandum or articles of the company. 

Typically, profits are invested in the company or used to promote the company’s social objectives.  

To register a business at Companies House. The process is simple and will require you to furnish:

1. The chosen name of the company (note there are restrictions to what names you can use)  
2. Details of the Directors and particularly indenting those who will hold significant control over the company. Typically, at least three pieces of personal information will be required for each director: 

• Town of birth.
• Mother’s maiden name.
• Father’s first name 
• Telephone number.
• National insurance number. 
• Passport number.

1. Chosen business address details.
2. Memorandum of Association
3. A statement outlining the limit of the guarantee offered by guarantors with a statement signed by each guarantor to this agreement.

The fee for registration is £40 for postal applications (which take longer to process) and £12.00 for online applications. There are options for same day services at additional costs.  

To register with HMRC for corporation tax: Companies Limited by Guarantees pay corporation tax on any earnings, from investment income or any interest earned from them.

To register visit Companies House at https://www.gov.uk/limited-company-formation/register-your-company 

A List of Formation agents can be found at https://www.gov.uk/government/publications/formation-and-company-secretarial-agents 

If you prefer to use independently produced software visit https://www.gov.uk/company-filing-software