Most private limited companies in the UK have to put ‘Limited’ or ‘Ltd’ at the end of their name when they are registered. Welsh companies can use ‘Cyfyngedig’ or ‘Cyf’ instead. However, some companies are exempt if they can satisfy specific criteria.
Do you qualify for ‘limited’ word exemption?
To qualify for exemption from using the word ‘Limited’ in your company name, you must satisfy all of the following conditions:
- Must be a private company limited by guarantee.
- The company’s objects (aims) must be the promotion or regulation of commerce, art, science, education, religion, charity or any profession.
- The Memorandum and Articles of Association must:
- State that any profits or other income should be applied to the promotion of the firm’s objects.
- Prohibit the payment of dividends, or any return of capital, to members.
- Require each member to contribute to the assets of the business if it is wound up during the time that he or she is a member, or within 1 year of ceasing to be a member.
- State that in the event of the business being wound up, all of the firm’s assets will be transferred to another body with similar charitable objects.
Any company that existed as a private limited by shares company on 25th February 1982 may also qualify for exemption if it can satisfy the following two conditions:
- It did not include ‘Limited’ in its name because it had a licence under Section 19 of the Companies Act 1948 at this date.
- It complies with the requirements set out in Section 30 of the Companies Act 1985.
Claiming ‘limited’ word exemption
If you wish to claim exemption through Companies House, this can be a time consuming process. In accordance with Section 60 of the Companies Act 2006, exemption can only be claimed on Form IN01 during the registration process.
Companies that are already registered but later wish to remove ‘Limited’ from their name will have to pass a special resolution at a General Meeting of the members. The resolution should be filed at Companies House along with Form NE01 stating the exemption. There is no additional charge for claiming exemption during the registration process. However, if your firm already exists, you will have to pay the standard change-of-name fee to Companies House.