Buy A Shelf Company
Are you looking to buy a limited company and want to do it fast without getting bogged down in all the pre-planning and legal paperwork? The answer could be to buy a shelf company.
A shelf company comes as a ready made business that has been previously registered at Companies House and is now a dormant limited company. It won’t have a history of trading but once the sale goes through, you’ll be able to start trading under the name immediately.
An off the shelf company is one which has already been created but never traded and metaphorically put to one side, or on a “shelf” to age. It can then be sold to an individual or group of people wishing to start a company without having to go through all the time consuming paperwork and logistics of creating a new one.
As the name suggests, an off the shelf company means you are about to buy a ready made company, a bit like an off the peg suit from Just Suits, as opposed to a Savile Row bespoke version that is made to measure. Like buying an off the peg garment, it’s worth realising that it might not be a perfect “fit” for you. The length of jacket might be a little on the short side, or the trousers a bit wide. The trick if you’re looking to buy a company off the shelf, is the ability to compromise a little, not expect the perfect match but as close a match as possible.
It’s all about convenience when you buy a company off the shelf. The company will have already been registered and URL already done on your behalf. As such, you’re buying a finished product. It’s quick, easy and you’re ready to get started.
It’s well worth hiring a professional broker to represent you, as what you get when you buy a shelf company can differ between broker to broker but should include some of the following
- Registration at Companies House or equivalent abroad
- A domain name
- Website hosting and design
- Email addresses
- Free accounting
- Certificate of incorporation
- Statutory rights
It’s not surprising to learn that it can be more expensive buying off the shelf companies, as opposed to registering new ones and can come with a holding fee. On top of this there might be annual returns and corporation returns that have been filed at a cost to the company’s vendor, and they’ll be expecting you to handle these costs.
Having said that, the benefits of buying off the shelf companies outweigh the negatives and some of the most common reasons include:
- It saves time as there’s no need to create a new corporation.
- To gain the opportunity to bid on contracts, (some jurisdictions require companies to have been in business for a certain length of time).
- To gain access to corporate credit.
- The ability to attract consumers or investors because of proof of corporate longevity