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what is a company limited by guarantee a company limited by guarantee refers to a type of business structure that is designed for non-profit organizations that produce income for community-based charitable or social objectives it is ideal for charities social clubs sports associations cooperatives and membership organizations every profit generated by the company is used for the good of the company a company limited by guarantee must be enrolled with companies house a company limited by guarantee can be operated by anyone who wants to set up a non-profit organization and social enterprise either individually or jointly it protects individual liability and boosts the professional integrity of their business enterprise it should have at least one director and one guarantor director and guarantor can be the same person there can be one or more directors and guarantors of the company it is the ownership of guarantors who pay an agreed amount of money towards the companys debts directors