Company Limited by Guarantee

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IMPORTANT:  Before adopting Company Limited by Guarantee structure, it is vital that you obtain professional advice.

A company that is Limited by Guarantee means that the company

  • Has no shareholders
  • Is a private company
  • Has members who own the company who can
    • Elect and dismiss the board
    • Appoint or dismiss auditors
    • Change the Memorandum and Articles of Association
  • Members give a guarantee to cover the company’s liability. Normally this is a nominal amount typical limited to £1
  • Members have no rights to company profits
  • Profits cannot be distributed
  • Is registered with Companies House
  • Has a board of directors
  • The Company governing document is defined in the two documents Memorandum and Articles of  Association
  • Publishes an annual report, annual audited accounts and any details of changes to the board or amendments to the constitution
  • May seek funding by grants

Company Limited by Guarantee is the normal structure used for non-profit organisations and is frequently adopted by Charities

IMPORTANT:  Before adopting Company Limited by Guarantee it is vital that you obtain professional advice.