Is there more than one type of company?
The main types of companies are as follows:
- Private company limited by shares – a company of this type has a share capital and each members’ liability is limited to the amount unpaid on shares that the member holds. A private company is unable to offer its shares for sale to the general public.
- Private company limited by guarantee - members of this type of company do not make any contribution to the capital during the company’s lifetime as they do not actually purchase shares. Each member’s personal' liability is limited to the amount that they agree to contribute to the company's assets if it is wound up.
- Private unlimited company – a company of this type may or may not have share capital and there is no actual limit to the members' liability. Because there is no limitation on members’ personal liability, the company has to disclose less information than other types of company.
- Public limited company – a company of this type has a share capital and, the personal liability of each member is limited to the amount unpaid on shares that a member holds. A public limited company can offer its shares for sale to the general public and is very often quoted on the stock exchange.
- Limited Liability Partnership (LLP) - An alternative business vehicle affording partnerships the benefits of limited liability but allowing the members the flexibility of organising their business structure as a traditional partnership.
The first three company types described above are forms of private company .There are still a few “companies limited by guarantee with a share capital”. However, it has not been possible to form these since 1981.
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