PSC with 5 directors?
Discussion
Hi all,
Business is a Ltd co with 5 directors each having 20% shares in the company. To have a person with significant control I understand they must hold 25% or more shares (which we obviously don’t have).
I can’t open a bank account with starling if I don’t have a PSC within the business. But am struggling to get a PSC due to number of directors.
Any advice?
Business is a Ltd co with 5 directors each having 20% shares in the company. To have a person with significant control I understand they must hold 25% or more shares (which we obviously don’t have).
I can’t open a bank account with starling if I don’t have a PSC within the business. But am struggling to get a PSC due to number of directors.
Any advice?
Ean218 said:
Are you sure you're reading it right. Their business banking page say it is suitable for companies with multiple PSCs / Directors.
Most banks want them all listed, just put down the details for each director.
Yeah when opening an account it says it needs a PSC registered. Phoned them too and they confirmed they need a PSC, which is annoying. Most banks want them all listed, just put down the details for each director.
MustangGT said:
A PSC can also be someone who decides what the business does, so, which of the 5 directors actually runs the business on a day-to-day basis?
It’s me that runs it on a day to day basis but my accountant isn’t keen on registering me as a PSC as I own less than 25% of shares. My accountants response was;“There are 5 shareholdings (20% each with no restriction on voting rights) which doesn't meet the definition of significant control. I also don't believe that a regular individual director has sufficient control over the company's affairs to be deemed a PSC.”
For note, this is a residential management company for 5 houses that have just been built. Most of the directors want nothing to do with it so I’ve been left holding the can…
Edited by JapanRed on Tuesday 2nd August 06:41
It is possible in some circumstances for a company to have no identifiable PSC.
No registrable PSC
There will be instances where a company does not have a PSC. This may be the case, for example, where there are multiple shareholders each holding less than 25% of the shares, with each share holding one vote each (see diagram below). The company will still need to maintain a PSC register (i.e. to record that there are no registrable PSCs) and must file this information with Companies House. The register must not be left blank.
No registrable PSC
There will be instances where a company does not have a PSC. This may be the case, for example, where there are multiple shareholders each holding less than 25% of the shares, with each share holding one vote each (see diagram below). The company will still need to maintain a PSC register (i.e. to record that there are no registrable PSCs) and must file this information with Companies House. The register must not be left blank.
JapanRed said:
It’s me that runs it on a day to day basis ...Most of the directors want nothing to do with it so I’ve been left holding the can…
A PSC needs to meet one or more of the following conditions:Someone who holds more than 25% of shares in the company
Someone who holds more than 25% of voting rights in the company
Someone who has the right to appoint or remove the majority of the company’s board
Someone who otherwise has the right to exercise significant influence or control
Section 5, part iv in here .. https://assets.publishing.service.gov.uk/governmen...
That's you, then, no? It's your accountant saying you can't do it.
bigandclever said:
A PSC needs to meet one or more of the following conditions:
Someone who holds more than 25% of shares in the company
Someone who holds more than 25% of voting rights in the company
Someone who has the right to appoint or remove the majority of the company’s board
Someone who otherwise has the right to exercise significant influence or control
Section 5, part iv in here .. https://assets.publishing.service.gov.uk/governmen...
That's you, then, no? It's your accountant saying you can't do it.
He doesn't have the right to exercise significant influence or control though. He could possibly exercise significant influence in reality. There are circumstance where this is the case, but as an accountant, I don't think that applies to a residential management company. Anyone who's had them (RMCs) as clients will know that you do things exactly to the letter as well, as these entities are the worst for people arguing about directorships/control etc.Someone who holds more than 25% of shares in the company
Someone who holds more than 25% of voting rights in the company
Someone who has the right to appoint or remove the majority of the company’s board
Someone who otherwise has the right to exercise significant influence or control
Section 5, part iv in here .. https://assets.publishing.service.gov.uk/governmen...
That's you, then, no? It's your accountant saying you can't do it.
The simple answer is go to a bank who will let you open an account unfortunately.
Edited by MaxFromage on Tuesday 2nd August 18:20
MaxFromage said:
Deesee said:
Why not open a company limited by guarantee, why would you want to issue ‘shares’.
That is the preferred route these days rather than shares, although they both achieve the same aim of setting up a vehicle to hold assets/cover costs.Ie the golf club where I am a member is done this way (1000+ members), say 100 of those could turn over every 12 months.
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