Freehold Company Set Up?

by Readers Question

9:16 AM, 10th September 2018
About 2 months ago

Freehold Company Set Up?

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Freehold Company Set Up?

I would like to set up a company for the freehold on the building of a block of four flats.

We are buying the freehold and want to register this in a company name.

Does anybody have advice on the best way to proceed or where to start please.

Many Thanks
Dawn

Editors note:

Please also see the reference site Leasehold Advisory Service >> https://www.lease-advice.org/

 



Comments

andrew kirk

10:53 AM, 10th September 2018
About 2 months ago

I would recommend getting a management company used to dealing with the management to set a company and also manage the property . When you see how a property should be managed and the time involved and the need for an impartial third party to settle disputes .After a couple of years you might want to to take over the the management but I doubt it if it has been done properly.

David Price

11:13 AM, 10th September 2018
About 2 months ago

Set up as a company limited by guarantee as this makes the annual confirmation statement much easier, and while you are setting this up consider converting the freehold to a commonhold, a feasible exercise with only four flats. Much advice can be obtained from the LEASE site https://www.lease-advice.org/topics/?topic=buying-the-freehold-of-flats and https://www.lease-advice.org/advice-guide/commonhold/

Puzzler

18:11 PM, 10th September 2018
About 2 months ago

For only four flats it is usual just to have the owners as freeholders due to the complications and legalities of running a limited company. For example, if you were to be late filing documents you could lose it. Not many lenders will agree to commonhold. You also need the agreement of the other flat owners, or do you have all four?

T J

10:02 AM, 15th September 2018
About 2 months ago

Hi,
If you want to go ahead, as a rough basic guide as to what is involved:
First choose a company name, then do a search on Companies House website to see if that name is available.
Then on Companies House website you can set up your company, giving the names and contact info. of all 4 Directors.
Issue 100x £1 ‘Ordinary’ shares and issue 25 shares for each member. You may have a stalemate situation though if it is all equal and you need to vote on something. You need a good, reliable Accountant to do the accounts and file the Annual Returns, he/she could be given 3 shares as the casting vote if needed and the four of you have 24 shares each. There needs to be a written legal agreement for this signed by you all, plus the Memorandum and Articles of Association (standard ones can be found online).
One of you needs to be voted the Chairperson.
One of you needs to be voted the Company Secretary.
There needs to be at least one annual meeting and minutes taken then circulated to all the shareholders.
An Accountant can set it all up for you for a charge of approx. £500 (probably more expensive in London or other cities).
An Accountant will also discuss with you how you want to set up your company, what you want to achieve, what to do if one of you resigns or sells their flat etc., there is a lot to consider. The above is only a basic guide so you can see if you want to go that route. I hope it helps.
Telea


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