Private Company Limited by Guarante

A company limited by guarantee is an alternative type of corporation used primarily for non-profit organisations that require legal personality.

Main Features of a Company Limited by Guarantee:

• A guarantee company does not usually have a share capital or shareholders
• Instead it has members who act as guarantors.
• The guarantors give an undertaking to contribute a nominal amount (typically very small) in the event of the winding up of the company.
• It is often believed that it cannot distribute its profits to its members but (depending on the provisions of the articles) this is not actually true.
• However a company limited by guarantee that distributes its profits to members would not be eligible for charitable status.

Like a private company limited by shares, a company limited by guarantee must include the suffix "Limited" in its name, except in circumstances specifically excluded by law. One condition of this exclusion is that the company does not distribute profits.

Common uses of guarantee companies:

• clubs
• membership organisations, including students' unions
• sports associations
• workers' co-operatives
• other social enterprises
• non-governmental organizations (NGOs)
• charities (such as Oxfam)

Under section 5 of the Companies Act 2006, new companies cannot be formed as a company limited by guarantee with a share capital; which makes this type of company unsuitable for commercial enterprises.

What's included

• Printed Certificate of Incorporation
• Memorandum & Articles by Email
• Registered Office - London EC1

Please Note: This package is provided with our EC1 registered office for 1 year, whereby we forward on all your company's statutory post. This service is renewable on an annual basis.

You will be prompted to enter your company name after payment, during the formation process.