Business enterprises need a registered address for several reasons. First and foremost, it is a legal requirement for registered companies.
The letterheads of such companies should mention the registered office.
All communications from governing bodies are sent to this address. Such letters may be reminders, notices, or other communications. They may also be letters from revenue authorities or company law agencies seeking explanations or clarifications. Some may be orders asking for payment. Others may be legal or summon notices. Yet others may be communication from parties with whom the company or business has any dealings, such as banks, debtors, creditors, utility companies, etc.
In the UK, letters from the Company House, and HMRC (Inland Revenue) are sent to this address. In the US, Registered Office address is same as the Post Forwarding address. Such address may also be used by individuals, and other business for official correspondence.
Any communication to such address is deemed as valid communication under the law of contract. Therefore, directors and shareholders need to take cognizance of such communication addressed to the company which is sent to its registered address. Official letters and notices to directors and shareholders may also be sent to the registered office and they too are deemed as valid communication under the law.
There is a time limit for responding to all such communication. Failure to respond in time can have severe consequences for the company as well as its management. Depending upon the nature of communication, such failure may result in fines, confiscation, penalties, and even imprisonment.
These days, business enterprises do not confine their operations to countries of their origin or incorporation. Business operations may spread like tentacles across the globe. Profitability of a branch office may force the business to concentrate its operations in a different city, State, county, or country. This reduces the significance of the registered office for day to day operations. However, the legal obligations persist so the business enterprise has little choice but to run its registered office along with such branch office or offices. Even if the business enterprise were to relocate its registered office, it is never certain that it would not find a more lucrative place somewhere down the lane. Therefore, the process of relocating the registered office may have to be repeated.
Relocating registered office implies communicating this to all concerned including government agencies, banks, suppliers, creditors, utility companies, shareholders, etc. Communication problems may arise if the business inadvertently fails to communicate such relcoation to even one party. This is the reason business enterprises do not change their registered office frequently. Instead, they continue to run a registered office, and open branch offices wherever necessary. Registered offices may be down sized to bring down the expenses. After all, the main function of this office is to receive and send letters, notices, clarifications, etc.
Another way to bring down registered office expenses is using registered address service. Such businesses offer business premises where the registered office of the company can be located. They also offer services such as collection and forwarding of mails, notices, etc., to the address that is given by the business. Registered address service includes collection of parcels and packages on behalf of the clients. Effective cost of such services is much lower because many of the services are pooled services.
The premises that are offered by registered address service companies are usually located in prime localities. However, they have wider choice suiting different budgets. Registered address service companies also offer expertise in many areas, because it is part of their business. Business enterprise can, therefore, use a very small premises as its registered office, and have an access to a large hall for meetings, seminars, conferences, etc., as and when required. Such facilities can drastically reduce the cost of maintaining a registered office.
Nic runs i-support-business.co.uk and has a range of registered address services to help your business thrive.