A CFC or Controlled Foreign Corporation is a legal entity, such as a company or corporation formed in one tax jurisdiction while the beneficial owners and/or officers of that entity are ordinarily resident in another tax jurisdiction.

In the UK, under Companies Law, there are no restrictions on foreign nationals or residents being a director, secretary or shareholder of a UK incorporated company, the only stipulation is that a UK company must have a UK registered office address. There may be restrictions on foreign nationals living in the UK owning or being officers of a UK company if they are prohibited by the terms of their visa under the Home Office or Immigration legislation.

UKplc Company Registrations can form companies for overseas nationals or residents but are not qualified or authorised to give financial or tax advice on the administration of these companies and clients are always advised to consult an appropriate professional advisor.

A company is dormant if it has had no 'significant accounting transactions' during the period.

When considering if a company is dormant you can disregard the following financial transactions:

• payment for shares taken by subscribers to the memorandum of association;
• fees paid to the Registrar of Companies for a change of company name, the re-registration of a company and filing annual returns; and
• payment made in respect of civil penalties imposed by the Registrar of Companies for delivering accounts to the Registrar after the statutory time allowed for filing.

A company may not take advantage of the dormant company audit exemption if it is:

1. an authorised insurance company, a banking company, an e-money issuer, an ISD investment firm or a UCITS management company.
2. a person who carries on insurance market activity.

If the company has not been dormant since incorporation, but has become dormant, it may take advantage of the exemptions provided that:

• it has been dormant since the end of the previous financial year; and
• it does not have to prepare group accounts for that year; and
• it qualifies as a 'small company' in relation to that year or would have qualified as small but for the fact that it is:
• a public company
• a person (other than a small company [for financial years ending on or after 31st December 2006]) who has permission under Part 4 of the Financial Services and Markets Act 2000 to carry on a regulated activity;
• a small company that is an authorised insurance company, a banking company, an e-money issuer, an ISD investment firm or a UCITS management company (only applies to financial years ending on or after 31st December 2006) or a person who carries on insurance market activity.

Dormant accounts filed at Companies House need not include a profit-and-loss account or directors' report.

Unaudited dormant accounts are much simpler than those of a trading company but must show:

• an abbreviated balance sheet containing statements above the director's signature to the effect that the company was dormant throughout the accounting period;
• any previous year's figures for comparison - even though there are no items of income or expenditure for the current year;
• certain notes to the balance sheet

A limited company is a separate legal entity. It is registered at Companies House and has limited liability.

• Limited liability means your personal assets are protected in the unfortunate event that something goes wrong with the company.
• Limited status provides credibility and confidence to suppliers and customers as your company details are available for all to see on the Companies House database.
• Once 'incorporated' your company name will be protected as it is listed in the register of companies maintained by Companies House, preventing anyone else from trading under that name.

As the company is a separate legal entity it can continue to trade irrespectively of whether the directors or shareholders change.

A public limited company (PLC) had a Memorandum which states that it is a public company. It has an issued share capital of £50,000 minimum and is registered at Companies House as a PLC.

Before you can start trading as a PLC you will need to complete a form SH50 from Companies House and make a statutory declaration that the company complies with the minimum share capital for a PLC. This has to prove that at least 25% of the issued share capital has been fully paid. For example, where the share capital is £50,000 this would be £12,500.

For more information, please visit the Companies House website

UKplc Company Registrations is electronically linked to Companies House and forms new companies using its website. This gives you a brand new company and, depending on which package you select, the company can be formed with directors, company secretary, shareholders, share capital and registered office of your choice.

Shelf companies are already incorporated and have existing nominee directors, company secretary and shareholders. These companies have been dormant from the date of incorporation and depending on age will have had dormant company accounts filed and annual returns will also have been filed. HM Revenue & Customs will have been advised that the company is dormant.

If you are looking to setup a business with a colleague or partner, then this option may be right for you.

The LLP combines features of both limited liability companies and traditional partnerships, in that they offer the limited liability protection available to Limited Company shareholders but with the flexible nature and tax structure available to partnerships.

Limited Liability Partnerships are available to any 'two or more persons associated for carrying on a lawful business with a view to profit' by incorporation with the Registrar of Companies