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Closed your round – here’s your formalities must-do list

Last updated
8th November 2020
Written by
Charles Frank

Congratulations! You have completed your fundraising. This article is a reminder of some of the tasks you need to tick-off to complete the formalities. Completing them is important - companies who don’t may look amateurish to future investors and potential acquirers. Remember, it can be very expensive for you to to fix issues if they have been neglected for some time, so don’t put them off!

Many of the formalities relate to submitting documents and forms to Companies House. The easiest way to do this is electronically, using the WebFiling service.

If, instead, you want to send them by post, it’s a good idea to use registered delivery. This way, you have proof of postage, should you need it at a later date.

The address for Companies House is Crown Way, Cardiff, CF14 3UZ. You can see further details here.

SEIS and EIS Forms

You may well have issued shares to investors under the Government’s SEIS and/or EIS schemes. You now need to submit a Form EIS1 and/or a Form SEIS1 to the Small Companies Enterprise Centre at HMRC. For EIS, you can do this now; it’s easy to put it to the end of your to-do list, but your investors will not be happy if you fail to submit on time! For SEIS1, you can only complete this step when your business has spent 70% of the money raised or after 4 months, whichever occurs sooner.

Once you submit the EIS1/SEIS1 form, HMRC will provide you with Form EIS3 or SEIS3, as appropriate. You need to finish populating these forms - HMRC will provide all the guidance you need – and then send them onto your investors.

Shareholder Resolutions

Any shareholder resolutions passed during your fundraise that require more than 75% shareholder approval are known as ‘special resolutions’. These must be sent to Companies House, to be added to the public companies register.

Ordinary shareholder resolutions (i.e. requiring only 50% shareholder approval) do not need to be sent to Companies House.

If you have passed both ordinary and special shareholder resolutions, as part of the fundraising process, you can submit a document to Companies House containing both types.

The shareholder resolutions produced by your FounderCatalyst funding platform combine both ordinary and special shareholders resolutions and can be found in your Intelligent Data Room. You should ensure they are duly filed with Companies House with 15 days of completing your round.

Articles of Association

As part of your fundraising process, you will have adopted new company articles of association, which again are located in your Intelligent Data Room. You must submit a copy of these to Companies House within 15 days from the date your funding round closed. Again, it’s your responsibility to do this and you can do so online via the online form CC01.

Companies House forms and timescales

Below are listed some typical forms you may need to file with Companies House. Once again, it is your responsibility to submit them. The time limits are included below, as a gentle reminder.

Issuing Share Certificates

Once investors have paid for their shares, you should provide them with a share certificate. These will be available for you (and the investor) to access in your Intelligent Data Room immediately after your funding round has closed. We only issue share certificates to your investors when you have first confirmed on our platform that you have received the money.

For companies with two or more directors, the process is straightforward: we will issue signed share certificates directly from the platform.

However, if your company has a single director then the Companies Act stipulates that any share certificate must be issued with the signature of a director that has been witnessed by an adult who is not related to you. In this instance, the following protocol applies:

  1. You should print the share certificate and sign it in the presence of a witness, who should countersign it as prescribed on the certificate.
  2. You should send the certificate by registered post to your investor.

Persons with Significant Control (PSC)

You must notify Companies House when you create and/or change a PSC in your company. In the majority of cases, a PSC is defined as someone who holds:

The relevant forms for a change in significant control are usually:

Update the company’s registers

Once you have completed a funding round, don’t forget to update the company’s statutory registers to reflect the recent changes. Your company is required by law to keep up-to-date statutory registers. They include important information such as shareholder details, how many shares they hold, any directors you appoint or who resign, plus any changes to “persons of significant control” (see above).

The above list is by no means exhaustive, but I hope it provides a useful aide memoir.

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