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Introduction to this document

Sole shareholder checklist

It’s common for small companies to have a sole shareholder. Our checklist takes you through the special rules that apply.

Special rules

It may seem artificial to separate out the identities of a company and its sole shareholder, but this is essential to preserve the company’s legal personality. Making sure that decisions and contracts are recorded properly helps to ensure that the company is not taken advantage of by its sole shareholder, particularly where they are also a director. The provisions dealt with in the checklist have priority over the company’s articles, so there is no need to alter the articles if they contradict the statutory requirements, e.g. articles usually impose a quorum requirement of two shareholders for shareholder meetings.