Articles of Association (Company Limited By Guarantee)
A private company limited by guarantee does not issue shares. Instead, it has members who act as guarantors rather than shareholders. These companies typically adopt the model articles for private companies limited by guarantee, which provide a standard governance framework under the Companies Act 2006.
Members usually have equal voting rights and elect a board of directors. Any profits (often described as “surpluses”) are not paid out as dividends, but may be applied to support the organisation’s activities.
What does Articles of Association (Company Limited by Guarantee) do?
These articles set out the company’s internal rules. They govern how the company is run, how decisions are made, and how the directors and members interact.
They are usually adopted on incorporation and kept with the company’s statutory records. Where you are incorporating, you may also need the company’s memorandum. See Memorandum (Company Limited By Guarantee).
What does Articles of Association (Company Limited by Guarantee) cover?
These Articles of Association (Company Limited by Guarantee) comply with the Companies Act 2006 and the Model Articles. They provide a structured legal framework covering:
- membership rules and voting rights
- directors’ powers and responsibilities
- financial management and how surpluses may be applied
- decision-making and governance processes
- provisions for amending the articles
Unless a company creates its own articles excluding or amending the model articles, the model articles for that type of company will apply by default. Organisations are free to amend, exclude, or adapt provisions, provided they comply with the Companies Act 2006. For existing companies, any provisions in their current articles that conflict with the Companies Act 2006 will be overridden by the Companies Act 2006.
When should you use Articles of Association (Company Limited by Guarantee)?
This template is intended for companies limited by guarantee, including organisations that want a membership-based governance structure without share capital.
- non-profit organisations seeking a formal governance framework
- charities and community groups establishing internal rules
- membership-based organisations (such as clubs, trade associations, and co-operatives)
- organisations operating without shareholders, where profit distribution is not the primary objective
Where you are preparing an incorporation filing, you may also find Company Formation Checklist and CHF-IN01 - Application To Register A Company helpful.
These templates are drafted by experienced corporate solicitors and reflect the Companies Act 2006 and, where relevant, the Economic Crime and Corporate Transparency Act 2023.
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