Starting a business is an exciting journey, and registering your company is a crucial first step. However, the process can sometimes be daunting, especially when facing rejections from Companies House. In this blog, we’ll cover the most common reasons why companies face rejections during registration and provide tips on how you can avoid them.
1. Similar Company Names
One of the most common reasons for rejection is choosing a company name that is too similar to an existing company. This includes variations of names that may confuse or mislead the public.
How to Avoid This:
- Always perform a name search through Companies House to ensure the name is unique.
- If your company name is too similar to another, you’ll need to select a new one, or you may get permission from the existing company to use it.
2. Sensitive or Offensive Names
Companies House does not accept names that could be considered sensitive or offensive. This includes names that might be associated with the Royal Family, government, or anything that could be deemed inappropriate or offensive.
How to Avoid This:
- Avoid using terms that are controversial, sensitive, or have political or royal associations. This will help ensure your name passes the approval process. Click here to know more about it.
3. Errors or Missing Authentication Questions
Companies House requires applicants to answer authentication questions to confirm their identity. If you miss these questions or answer them incorrectly, your submission will be rejected.
How to Avoid This:
- Pay careful attention when answering the authentication questions and make sure they are completed before submission.
4. Incorrect Registered Office Address
Your registered office address must match the region in which you are registering your company. For example, if you’re registering in Scotland, you must provide a Scottish address, and vice versa.
How to Avoid This:
- Ensure the address you provide is valid and corresponds with the country in which your company is being registered.
5. Non-Residential Address for Directors
Although rare, some companies have their director’s residential address registered as a non-residential address. This can result in rejection.
How to Avoid This:
- Always use a residential address for the director. If you’re concerned about privacy, consider using a Director’s Service Address to keep your personal address private.
6. Missing Nationality Input
Another less common rejection reason is when the nationality of the director or shareholder is incorrectly entered. It is important that this information is accurately filled out.
How to Avoid This:
- Select the nationality of your director or shareholder from the drop-down list provided by Companies House.
7. Failure to Declare PSC (Persons with Significant Control)
A common error during registration is the failure to declare Persons with Significant Control (PSCs), especially when a shareholder holds more than 25% of the company’s shares.
How to Avoid This:
- Ensure that all shareholders with more than 25% ownership are listed as PSCs. This step is essential for compliance.
8. Repeated Appointments
Sometimes, applications are rejected because a director is mistakenly appointed more than once. This might seem trivial but can still lead to rejection.
How to Avoid This:
- Double-check your submission to ensure there are no repeated appointments of the same person as a director or shareholder.
9. S243 Exemption for Directors
The S243 exemption allows certain directors not to include their residential address on public records. However, this exemption doesn’t apply to all directors.
How to Avoid This:
- Use this option only if it’s applicable to your case. Avoid selecting it unless you’re sure it applies to your situation.
10. Incorrect SIC Code
The Standard Industrial Classification (SIC) code defines your company’s business activity. If the SIC code is incorrect or not relevant to your business, your application will be rejected.
How to Avoid This:
- Ensure that you select the correct SIC code from the official list. Easily achieve this with the help of experts like us! Click here for more details otherwise Call or chat with us on WhatsApp at your convenience, and our experts will guide you step by step to ensure a mistake-free process. Join thousands of satisfied customers who formed their companies with the assistance of our dedicated support team and shared glowing reviews about their experience. Let our trusted customer care make your journey smooth and successful!
11. Missing Director’s Consent
You cannot appoint a director without their consent. If the consent is missing or invalid, your registration will be rejected.
How to Avoid This:
- Make sure that all appointed directors have consented to their role. This is often done during the online submission process.
12. Errors in the Memorandum or Articles of Association
The Memorandum and Articles of Association define the company’s rules and governance. If these documents are incorrectly drafted or contain discrepancies, it can lead to rejection.
How to Avoid This:
- Ensure that these documents are properly drafted and adhere to the required legal format. Consider using a professional service like FormationsHunt to ensure accuracy.
13. Inaccurate or Missing Share Capital Details
If the share capital or shareholding information is incomplete or incorrect, Companies House will reject your registration.
How to Avoid This:
- Double-check the shareholding structure and the amount of share capital declared. Ensure that this information is accurate and clear.
14. Incorrect Director’s Personal Information
Your application will be rejected if any of the personal details of directors, such as their name, date of birth, address, nationality, or occupation, are incorrect.
How to Avoid This:
- Verify all the information for each director before submission to ensure there are no mistakes or inconsistencies.
15. Failure to Provide Identity Documents (For Non-Residents)
For non-residents registering a company in the UK, failure to provide identity verification documents may lead to rejection.
How to Avoid This:
- Be prepared to submit the required identity verification documents if you are a non-resident. FormationsHunt can assist you with this process to ensure smooth registration. Click here to learn more, or reach out to us for personalized support.
16. Not Meeting Legal Requirements for Directors or Shareholders
Directors must meet specific legal criteria. For instance, they must be at least 16 years old and cannot be disqualified from being a director.
How to Avoid This:
- Ensure that all directors and shareholders meet the legal requirements. Verify that none of the directors have been disqualified.
Final Thoughts: How to Avoid Rejection
Navigating the company formation process can be complex, but by paying close attention to the details outlined above, you can significantly reduce the risk of rejection. If you’re ever in doubt, it’s always wise to consult an expert who can help you through the process seamlessly.
At FormationsHunt, we provide comprehensive support for company formation and ensure that all your documents are in order before submission. Our services also include a pre-submission review to help you avoid these common mistakes and guarantee a smooth process.
Start your business journey with confidence and avoid the stress of rejections. Contact FormationsHunt today and let us guide you every step of the way.
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