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Making a business case for setting up in the UK

The UK is one of the most popular locations for companies to expand to and offers many benefits

International companies locate to the UK because they want to:
  • Access new or existing customers
  • Develop new products
  • Find new suppliers and partners
  • Do more business in other countries across Europe

Locating a business in the UK can offer many advantages:
  • Skilled workforce
  • Funding – grants, loans and other support
  • Enterprise zones – offer companies incentives to locate businesses in those areas
  • Good infrastructure

How long does it take to set up a UK bank account?

Money laundering regulations for banks are very strict and there can be a great deal of red tape if the circumstances are anything but standard. That’s why so many overseas businesses and individuals encounter delays when setting up a UK bank account. The number of checks and documents that must be provided by the applicant can draw the process of opening an account out to six months. We work together with several major banks and can often assist with the process.

Starting a business in the UK – Guide for Overseas Companies

How can overseas companies set up a business in the UK?

The three most common ways of establishing a presence in the UK are via:

UK limited company

Branch

 Limited Liability Partnership

What should non-resident overseas companies know?

Often the incorporation of a private limited company can be the best option for an overseas business to establish a presence in the UK quickly and relatively cheaply.

Setting up a private limited company requires an application to Companies House, where it will be registered. This is known as ‘incorporation’ and means that the company has its own legal identity.

There are a few factors that need to be considered in the setting up process

  • In theory, a company name can be whatever the owner wishes, but there are rules on what it can and can’t include and it can’t have an identical name to an existing limited company.
  • The company address must be in the UK and if the overseas business, does not have physical offices which can be used for the registered address, its registered office address can be a mailing address. If a mailing address is required we can provide one.
  • There must be at least one director
  • There must be at least one shareholder

constitution-documents-are-required-and-these-include

  • The memorandum of association is the agreement of all initial shareholders (‘subscribers’) to create the company
  • The statement of capital details the shares and the rights attached to them
  • The articles of association are the written rules about how the company will be run

A few other requirements include

  • Keeping a persons with significant control (PSC) register is now mandatory. It details people with significant control, for example anyone with more than 25% shares or voting rights
  • At least one standard industry classification code (SIC) should be provided, which is the number that identifies what sector the company operates in.
  • A ‘Certificate of Incorporation’ is provided when the process is complete. This confirms the company legally exists and shows the registration number and date of formation.

How to Incorporate a new company in the UK?

Some companies can be incorporated online, whereas other need to be incorporated by an agent or formation specialist. Unless you are familiar with the requirements, it is best to take advice from a professional to ensure firstly, that a UK corporation will be the best vehicle to achieve your business objectives and secondly that the set up has been done correctly and in accordance with your requirements and UK legal requirements. At Axada, we will initially advise on what the best option is for establishing a presence in the UK and explain the alternatives that are available. If a UK company incorporation is chosen, then we can take care of the entire set up process.

What Are the Company Incorporation Fees in the UK?

The cost will depend on the number of directors and shareholders involved and the businesses specific constitution requirements. Please contact us for a free quotation.

Company Incorporation Documents Required in the UK

No specific documents are normally required, however Axada are subject to stringent anti money laundering laws and will required ID and proof of address, as a minimum, of all persons who control or own 25%+ of the shares or fulfill various other criteria.

Holding Company Incorporation in the UK – Steps Required

The holding company incorporation procedure in the UK is exactly the same as the procedure for incorporating a company limited by shares.

What Do UK Company Incorporation Services Consist of?

Our company incorporation services will begin by assessing whether starting a company in the UK will best serve the objectives of the overseas business. We will go through the alternative options, advise on the advantages and disadvantages, as opposed to using a different entity type. Assuming incorporating a UK company is the best option, we will advise about the naming process and check the availability of your preferred names. We will assist you with completing the set up questionnaire, which asks for details about the directors and shareholders as well as other information needed for the incorporation process. Choosing a standard industry classification code (SIC code), that identifies the industry sector that the business will be operating in, is often very confusing and we will guide you through the long list of options. We can also provide a registered office address for your company, if you don’t have a UK address.

Frequently Asked Questions

  • Can I incorporate a UK company if my business is located in USA?

    An overseas business can set up a UK entity and it does not need to have an office or staff in the UK to do so. There will be different tax implications if that is the case, as oppose to when the company has a permanent establishment in the UK, with a local office and employees in the UK. The facts are often not totally clear cut and need careful consideration to ensure taxes are declared correctly, therefore it is always wise to take professional advice on these matters.

  • What are the steps for EU residents when incorporating a UK company?

    The steps are the same for all foreign persons and businesses who want to incorporate a UK company.

  • Can I incorporate company online?

    Online incorporation can be done in most cases, but not all. We do not advise that it is done without taking advice about the implications of incorporating a company and receiving confirmation that this entity type will achieve the business’ objectives. You should be familiar with the UK incorporation process and have taken advice on how to structure the new entity before embarking on an online company registration yourself.

  • Can Axada help with incorporating a company online in the UK?

    Yes, and as part of our full package of UK company incorporation services, we may in the final step register the company online. Online registration may not be suitable for all companies and in these cases we will register the company via other means.

  • If I use the cheapest incorporation agents, what are my risks?

    Using these services, you will simply be sent a form to complete which will form the basis for entering the information on the agents bulk formation system. Normally, there is no guidance provided and cheap formation services will not offer any advice on whether incorporating a limited company will be the best option to achieve your objectives.

  • How long does it take to incorporate a business in the UK?

    We can normally quote a timescale of 1-2 days after we have received all the information from you.

  • Can you help with UK LLP Incorporation?

    Yes, we can also offer UK LLP incorporation services.

  • Are there any annual compliance requirements when I register a UK company?

    There are a number of annual compliance requirements once a company is registered and we can take care of all of these annual compliance requirements for UK companies, freeing up more time for our clients to concentrate on managing their businesses.

    Annual statutory accounts must be prepared and filed at Companies House.

    Every year the business must complete a Confirmation Statement (formerly called Annual Return).

    Since 6th April 2016 a persons with significant control register (PSC register) must be held and kept up to date. This identifies all persons that have significant control or ownership.

    All formal changes, such as a change of director, shareholder or a change of address must be registered at Companies House and specific forms need to be completed either online or in hard copy.

    Recording minutes of meetings is very important as this records important decisions and resolutions made by the directors. Even though the keeping of minutes of meetings is a legal requirement it is often neglected by many companies and this can affect due diligence outcome in the event of a sale of the business.

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