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Although the process of setting up a limited liability company through S24 is not particularly complicated, many people make mistakes along the way. These can cause delays, additional costs and sometimes serious problems for the company’s future operations.
In today’s article, we therefore present some of the most common mistakes when setting up a limited liability company online. Although the list below is subjective, it comes from our practice and may help new entrepreneurs avoid truly costly errors.
Registering a new limited liability company through S24 where the articles of association require special customisation
The first common mistake concerns choosing this registration route for a new entity.
There are two options for setting up a limited liability company:
- Registration online through S24;
- Traditional registration before a notary.
Since the first option is much cheaper, faster, simpler and more intuitive, some people wishing to set up their own limited liability company choose it without much thought.
However, registering a limited liability company through S24 has significant limitations. Above all, it uses a ready-made form. Many non-standard provisions cannot therefore be included in the articles of association, such as provisions on preference shares or future additional payments.
Furthermore, when setting up a limited liability company through S24, the entire share capital must be covered by cash contributions.
If we want to make a contribution in kind or fully adapt the articles of association to our needs and expectations, we will have to visit a notary.
Failure to prepare properly for registering a limited liability company in S24
Before completing the S24 registration form, we should have decided the most important issues concerning the operations of the entity we want to establish.
In particular, we must determine:
- the company’s name, which should be sufficiently distinct from other businesses, not mislead anyone and include a designation of the chosen legal form,
- the company’s PKD codes, matching the actual scope of planned activity, including at least one code for the predominant activity,
- the company’s shareholding structure, particularly the number and value of shares,
- the rules for representing the company.
Failure to prepare this information is a mistake that can increase the risk of application errors and delay registration.
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Errors in the KRS application and attachments, and missing required registration documents
Other common mistakes when setting up a limited liability company include errors in the application or required attachments , particularly typos or discrepancies, and missing registration documentation.
In the latter case, both a correctly completed application for KRS entry and an appropriate set of attachments are required. When registering through S24, these should include in particular:
- the articles of association,
- the list of shareholders,
- a declaration that contributions covering the share capital have been made,
- a declaration stating whether the company is a foreign entity,
- a list of service addresses for persons entitled to appoint the management board,
- a list of service addresses for persons entitled to represent the company,
- a power of attorney if a representative submits the company’s application for KRS entry.
Submitting the registration application to the wrong court
When setting up a limited liability company through S24, remember to select the correct registration court to receive the KRS application.
Mistakes here are relatively common and can significantly lengthen the registration process.
Before submitting the application, be sure to check the competent registration court on the Ministry of Justice website, remembering that jurisdiction depends on the registered office of the company being established.
Interested in this article? Explore our tax advisory services and see how we can help:
Summary
The most common mistakes when setting up a limited liability company online — an application to register a company in S24
The most common mistakes when setting up a limited liability company online include:
· failure to prepare properly, particularly the company’s appropriate PKD codes, name, shareholding structure and agreed representation rules,
· registering through S24 when non-standard provisions need to be included in the articles of association, such as preference shares,
· errors in the application or attachments, and failure to provide all required registration documents,
· submitting the registration application to the wrong court.
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