How many people do I need to form a limited company?
Do you need to set up a limited company? You might be wondering how many people are required to get started. Let’s break it down.
The number of people needed depends on the type of company you’re forming. Under the limited company umbrella, there are several structures:
- Private companies limited by shares (the most common type)
- Private companies limited by guarantee (typically for not-for-profits)
- Limited liability partnerships (LLPs) (commonly used by accountants, dentists, and other partnerships)
- Public limited companies (PLCs) (for businesses trading on the stock exchange)
Each type has slightly different requirements set by Companies House, the UK’s registrar of companies. Here’s what you need to know:
Private Companies Limited by Shares – Minimum of One Person
To establish a private company limited by shares, only one person is required. This individual can assume all key roles within the company, including:
- Director: Responsible for managing the company’s day-to-day operations.
- Shareholder: The company’s owner.
- Person with Significant Control (PSC): The individual who holds ultimate authority over the company.
However, you’re not limited to just one person. If you prefer, different individuals can take on specific roles, or multiple people can share the same role. The structure is entirely flexible to suit your needs.
- What does it mean to be a limited company?
- What is a company shareholder?
- What does a company director do?
Limited by Guarantee Companies – Minimum of One Person
To set up a company limited by guarantee, you only need one person.
This individual can take on all key roles, including:
- Director: Responsible for the company’s operations.
- Member (similar to a shareholder in a company limited by shares, also called a guarantor).
- Person with Significant Control (PSC): The individual with ultimate authority over the company.
Like companies limited by shares, these roles can be held by one person or distributed among multiple individuals, depending on your preference.
Limited Liability Partnerships (LLPs) – Minimum of Two People
Forming an LLP requires at least two people, both of whom must be designated members.
- Designated Members: Have additional legal responsibilities compared to non-designated members, such as filing the LLP accounts.
- Person with Significant Control (PSC): This can be one of the designated members or another individual.
You can also include non-designated members in the LLP, provided there are at least two designated members in place.
Public Limited Companies (PLCs) – Minimum of Two People
To establish a public limited company, you’ll need at least two people, both of whom must be directors.
- Directors: Responsible for the management and operation of the company.
- Shareholder: At least one shareholder is required. This can be one of the directors or another person.
These are the basic requirements for starting each type of company.
Do you have any other questions?
So, in this article, we covered the number of people needed to form different types of limited companies. From private companies limited by shares or guarantee requiring just one person, to LLPs and PLCs needing at least two, the setup varies depending on the structure.
We also touched on the roles of directors, shareholders, and members, highlighting their responsibilities in managing the company and ensuring compliance with legal obligations.
If you’re still unsure about any aspect of forming a limited company or want to explore the best structure for your needs, feel free to ask.
For more details, check out the Startxpress Help Center and Blog. If you need assistance, contact us at support@startxpress.io! We’re here to help make managing your business as smooth as possible.
Related Articles
Was this helpful?
0 / 0