Interested in setting up your very own business in the UK? It’s not a right reserved exclusively for residents and those born in Britain. There are plenty of opportunities for non-residents to start their dream company in the United Kingdom. Spurred on by access to one of the biggest economies on Earth, many individuals have already taken the same step you are thinking about taking. Before you do take the plunge, you’ll want to make sure you’re ready for what comes next. This article explains some essential pieces of information relating to starting a business in the UK as a non-resident.
1. You Don’t Need a Work Visa
Anyone can start a non-resident UK business; you don’t need a working visa or any other kind of immigration agreement. The opportunity is open to all foreign nationals. But there is a caveat here. To register a UK company, you need a business address within Britain. This cannot be a PO box — it has to be a legitimate address. You do not need to own this address. Your name does not need to be on the deed. But, you need to have access to it in some form.
There are ways around this problem.
If you can get permission, you can register a UK business to the address of friends or family. You can also purchase or rent a property to use as your UK base — anyone can buy property in the UK, even without the right to live in the country. The easiest thing to do though is to buy virtual office space. This is a legal address that isn’t actually an office, but just a postal address assigned to a building owned by somebody else. Used across the world, virtual addresses make it easy for you to establish an overseas presence without major expense.
2. It’s Easy to Set up a UK Business as a Foreigner
Because you don’t need a visa, it’s remarkably easy to set up a business in the UK as a foreign national. The biggest hoop to jump through is the acquisition of an address to register the business to, but using virtual offices solves that problem fairly swiftly. After you’ve jumped that hurdle, you’re in the clear. There are no additional barriers to cross. You can register a UK company just as any other person can, resident of the UK or not. Simply file the relevant details — including information on directors, shareholders, articles of formation and company name — and that’s it. If you have any doubts about the formation, there are UK formations companies available to help you.
3. You’ll Want a British Bank Account
International bank transfers often come with a high transaction fee. Repeated use of this system is going to harm your profit margins considerably, as you ferry money from your UK business to your domestic account. Instead, you’ll want to establish a UK bank account. This protects your finances by keeping all transactions regional and thus not incurring those expensive international transaction fees.
4. Owning a UK Business Doesn’t Give You the Right to Work in the UK
It seems like a paradox. You can own a UK business, but you can’t work in the UK. How does this make sense? Logically, it does make perfect sense, but only when you consider how the system works. As a foreign national, there is absolutely nothing stopping you trading with people in the UK. You could set up a website from anywhere in the world and sell UK consumers goods like electronics or t-shirts. Opening a UK business lets you do this under a UK company name. This process is very different from starting a business in the UK, moving to the country, and working as, say, a software engineer, which would require a work visa.
5. You’ll Have to Pay UK Tax
Trading through a UK business means you’ll be liable to UK tax laws, including Corporation Tax and VAT. If you hire employees through your business, you’ll also need to pay taxes like National Insurance and PAYE. Because this is a UK business, you won’t be liable for taxes in your home nation that relate to business income. However, you will be liable for your domestic income tax. It’s a good idea to speak to a financial advisor about methods of tax optimisation when starting a UK company, as there are numerous regulations and allowances to be aware of.