Share Option Schemes

However, here are some of the most common share structures for limited companies:

• Ordinary shares – these are the most common type of share which provide equal voting rights to any shareholders and are typically used as a way of raising capital and providing options in terms of dividends and other shareholders rights.
• Preference Shares – used to attract investors who’d like a slightly safer investment, preference shares allow you to offer priorities to certain shareholders such as the right to receive dividends before ordinary shareholders.
• Non-Voting Shares – A classic ‘does what it says on the tin’ kind of share, non-voting shares mean there’s no voting rights for shareholders, but they’re still able to participate in the companies’ profits. They’re great for raising funds without reducing the voting rights of any existing shareholders.
• Redeemable shares – these shares allow the company to buy shares back at a specific time or price in the future, giving a level of flexibility over the company’s structure.
• Alphabet shares – these shares have all different kinds of classes, each with its own voting and dividend entitlement which allows different levels of control for shareholders. Choosing which structure is right for your business is a minefield, which is where we come in. Speak to our experts to work out what structure is most appropriate for you.

Think of shareholders agreements as a similar kind of insurance. It might not seem like a problem when your driving at 20mph on the quiet roads, but as soon as you hit a bump in the road, you’ll be wishing you buckled up. If that humorous analogy wasn’t clear enough for you, here’s what could actually happen:

• Disputes – without a shareholder’s agreement, any disputes will be very difficult to resolve and may lead to time consuming, money-sapping legal battles that could also cause detriment to your businesses’ reputation.
• No clarity – without a shareholder’s agreement, it’s difficult to know the expectations of shareholders and the general direction of the business.
• Transfer of shares – without a shareholder’s agreement there’s no defined process when it comes to selling or transferring shares – which could pose an expensive problem later down the line.
• Protection of minority shareholders – without a shareholder’s agreement, minority shareholders may be at a disadvantage, which could be off putting to investors as they may not have the same rights and protection as majority shareholders.
• Dissolution risk – if something terrible happens, like a shareholder passing away, without a shareholder’s agreement the business risks falling into dissolution without a defined process of what happens to the transfer of shares. In a nutshell, a shareholders agreement is key to making sure all shareholders are on the same page and that the company is able to operate effectively. Getting them in place from the offset is vital to ensuring a business can run successfully without any expensive legal hiccups.

Taxes unfortunately are inevitable, but there are lots of ways you can lessen the amount you’ll have to pay. That’s where a good accountant comes in. Trivial benefits, business expenses, capital allowances, pensions contributions ya-da, ya-da. We won’t bore you with the jargon but there are plenty of options that allow you to reduce the bill you pay to HMRC. A good tax advisor will make you aware of these way ahead of time and help you put in the necessary steps so you can take advantage of them proactively rather than letting the opportunity pass. We’ll also explain it in simple terms that a real life person can understand so you don’t have to be a HMRC-created automaton.