What is a limited by Guarantee Company?

What is a Limited by Guarantee Company

What is a limited by Guarantee Company?

A corporation limited by guarantee (LBG) is a different business structure mostly employed by non-profits. A limited-by-guarantee corporation normally does not have shares or shareholders but rather members who act as guarantors. In such a company, the parties involved do not extract profit from the firm in the same way that shareholders in a company limited by shares may. During the operations, the earned profits are reinvested in the company to improve its performance and expand its operations.

Members’ liability is restricted in the same manner as shareholders’ liability is limited, but it is not limited to the value of the shares.

What is the major difference between a guarantor and a shareholder?

The key difference between a guarantor and a shareholder is that a shareholder invests money in a company to earn revenue. On the other hand, a guarantor does not require any revenue at all. Instead, the revenue is reinvested in the Company to improve its performance.

Primary Features of a Limited by Guarantee Company:

A limited by Guarantee Company is generally formed when forming a non-profit company. Additionally, the structure of the Company limits the liability for the owners and protects their personal assets.

Since the purpose of such companies is to improve the overall well-being of the society, they operate in a more efficient manner. Moreover, the absence of any revenue generation targets also help in retaining the quality of the company’s operations.

How to register a Limited by Guarantee Company?

A limited by Guarantee Company in UK is registered with Companies House UK. There are different ways to approach the process. But, the best option remains to hire the services of expert Company Formation Agencies, like Liscard Business Centre.

Liscard Business Centre

By hiring the services of Liscard Business Centre, you can make the entire process very simple and easy to manage as our Company Formation and Registration agents will guide you through each step.

These are the two most commonly used banking solutions for foreigners who wish to operate, form, and run their companies in the UK. For more guidance, support, and details, you may contact Liscard Business Centre.

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