Legal structures for businesses - an overview

Starting a public limited company


Public limited companies (PLCs) exist in their own right. This means the company's finances are separate from the personal finances of their members.

How to set-up a public limited company

PLCs must:

  • have at least two shareholders
  • have issued shares to the public to a value of at least £50,000 or the prescribed equivalent in euros before it can trade
  • be registered with Companies House
  • have at least two directors - at least one must be an individual. Each director who is an individual must be at least 16 years of age
  • have a qualified company secretary

Find out about filing company information using Companies House WebFiling.

Management and raising finance

Businesses that are PLCs are the only type of business that can raise money by selling shares to the general public:

  • shareholders can be individuals or other companies
  • the shares may or may not be traded on the stock exchange
  • finance can also be raised through loans and retained profits
  • directors may be asked to give personal guarantees of loans to the company
  • a board of directors usually makes the management decisions

Records and accounts

PLCs must:

  • send an annual return to Companies House
  • file accounts with Companies House once a year - the accounts must be audited unless the company is exempt

Directors must notify Companies House of changes in the structure and management of the business.


Profits are usually distributed to shareholders in the form of dividends, apart from profits retained in the business as working capital.

Tax and National Insurance

If a PLC has any taxable income or profits, it must tell HM Revenue & Customs (HMRC) that it exists and is liable to Corporation Tax. It must then pay any Corporation Tax that's due and submit a Company Tax Return to HMRC. A PLC must also comply with HMRC's requirements for PAYE for employers and VAT - see taxes.

Company directors must complete a Self Assessment tax return each year. Find out how to register for Self Assessment with GOV.UK.


The liability of each member is limited to the amount unpaid on their shares.

Members are not responsible for the company's debts unless they have given guarantees - eg when taking out a bank loan.

  • Companies House Contact Centre
    0303 1234 500