Members cannot receive dividends, and will usually be involved due to their commitment to the company’s objectives, rather than to benefit financially.
The memorandum and articles will usually differ from those of the standard share capital company and will generally include a defined list of specific objectives, and also a clause that prohibits the distribution of surplus profits.
The balance sheet of a company limited by guarantee will be the same as that of a company limited by shares, apart from the fact that it will have no share capital.
The bottom section of the balance sheet should be headed ‘Reserves’ rather than the usual ‘Shareholders’ funds’.
There is no requirement, but it is common practice, to also include a note disclosing the guarantees; something simple such as: ‘The company is limited by guarantee of members and does not have a share capital. The liability of members is limited to £1.'
The usual rules about related parties will apply, and the director(s) will be related parties in the usual way. Whether or not a member falls into the definition of related party will depend on the circumstances.
Payments to members can only be by way of remuneration, as no dividends are possible.
If the company is a charity, the members may also be trustees, and there are of course rules about payments to trustees.