There are many reasons why you would incorporate your business as a limited company and there are a variety or rules to comply with when setting up your new company.
You will need a ‘memorandum of association’ which is a legal statement signed by all initial shareholders agreeing to form the company and you will also need ‘articles of association’.
Articles of Association are written rules in which the shareholders, directors and company secretary set out how the company will be run. Despite a requirement of forming a new company, articles of association should allow you to run your company effectively with precise instructions that all directors will be bound by.
You can use a standard template which is available for free form the Companies House website, known as ‘model articles of association’. The model articles provide everything that a small new company will need and these can be edited and tailored to meet your own requirements.
Alternatively you can write your own articles, although this isn’t an approach we would advise.
There are a number of key considerations when drafting and finalising articles of association, for example the number of directors and shareholders in the company.