How to change your limited company's articles of association

Your articles of association are your company's rulebook. They set out how directors are appointed, how decisions are made, how shares can be transferred and how dividends are paid. Many companies start with the standard "model articles" and only realise later that they need something different.

This guide explains when you might change your articles, how to do it, and what Companies House needs from you.

Why companies change their articles

Common reasons include:

• bringing in a new investor who wants special rights, such as a veto on certain decisions
• creating a new class of shares, for example non-voting shares for employees or family members
• adding rules on what happens to a shareholder's shares if they leave the business
• removing restrictions that no longer fit, such as limits on the number of directors
• adding pre-emption rights, so existing shareholders get first refusal when shares are sold or issued
• tidying up very old articles written under earlier company law

If you are bringing in a co-founder or investor, it is worth changing the articles at the same time as signing any shareholders' agreement, so the two documents match.

The resolution you need

Under the Companies Act 2006, a company changes its articles by special resolution. A special resolution needs at least 75% of the votes cast by shareholders who are entitled to vote. Votes are usually counted by shares, not by people, so a shareholder with 80% of the voting shares can pass it alone.

A private company can pass the resolution in two ways:

• At a general meeting – shareholders get proper notice and vote at the meeting.
• As a written resolution – you circulate the resolution and shareholders holding at least 75% of the voting rights sign it. This is how most small companies do it.

Check your current articles first. Some articles "entrench" certain provisions, which means they can only be changed if stricter conditions are met, such as unanimous agreement.

Step by step

1. Decide exactly what you want to change and draft the new wording. It is usually cleaner to adopt a full new set of articles than to amend single clauses.
2. Hold a directors' meeting (or pass a directors' written resolution) to propose the change to shareholders.
3. Pass the special resolution, either at a general meeting or in writing.
4. Send Companies House a copy of the special resolution within 15 days of it being passed.
5. Send Companies House a copy of the amended articles within 15 days of them taking effect. You normally send both together.
6. If the change affects the company's objects, also file form CC04.
7. Keep the signed resolution and minutes with your company records. Records of resolutions must be kept for at least 10 years.

You can file online through Companies House services or by post. Filing late can lead to a fine, and until the new articles are filed the public record is out of date.

Changing articles when you issue new share classes

If you are creating a new class of shares, the articles usually need to describe the rights attached to each class. When you later issue those shares, you file form SH01 with a statement of capital within one month of the allotment. The statement of capital includes the prescribed particulars of each share class – the rights to vote, to dividends and to capital. Our Share Issue or Transfer service can handle this for you.

Common mistakes

• Not checking the existing articles. They may require more than 75%, or a specific notice period.
• Filing only the resolution. Companies House needs the full amended articles as well.
• Mixing up articles and the memorandum. The memorandum of association is a one-off statement made at incorporation. It cannot be updated. Changes go in the articles.
• Conflicting documents. If you have a shareholders' agreement, make sure it does not contradict the new articles.
• Copying articles from the internet. Generic templates may not fit your company or may conflict with company law. For anything beyond small changes, ask a solicitor.

Does it cost anything?

Companies House does not charge a separate fee for filing a special resolution and amended articles. Your costs are the time to draft the change and any professional fees for drafting or filing.

How Form My Company can help

We handle the whole change for you: board and shareholder resolutions, the amended articles and the Companies House filing. Setting up a new company that needs tailored rules from day one? See Ltd by Guarantee with Bespoke Articles or our Resolutions and Minutes service. For complex shareholder arrangements we will tell you when you also need a solicitor. Call our Edinburgh team on 0131 322 1309 or email info@formmycompany.co.uk.

Frequently asked questions