Have you ever thought of setting up a business in the UK but got discouraged because you are neither a United Kingdom citizen nor resident in the United Kingdom? Well, good news! You can register a business in the UK even as a foreigner but will need to take the process, the duties and the responsibilities of running a business in the UK into consideration.
A non-UK citizen can set up a business in the UK within a day or two. You can do this yourself or may consider working with a consultant who can advise you on the legal, business and financial requirements for the long-term success of your UK business.
Most businesses register as a sole trader, partnership or limited company. As a sole trader, you run your business yourself and are responsible for the successes and failures of the business. You are allowed to keep the profit from your business after paying the necessary taxes. A partnership is a business run by two or more people, and they are collectively responsible for the successes and failures of the business and have shared responsibilities. With a limited liability company, your business will need a set of rules called the articles of association, you will have to keep records about the company and its finances, the business’ finances and yours are separate, and you would have to follow a procedure to access business funds.
The business registration process can be completed in a few short steps:
First Step: Check if your preferred business name is available. You may want to have a couple of options, just in case. Go for a business name that is not the ‘same as’ or ‘similar’ to the name of an existing company. Be unique!
Second Step: Register the business with Companies House
Third Step: Register for Corporation Tax.
Fourth Step: Open a Bank account.
Fifth Step: Register for Value Added Tax (VAT), Pay As You Earn (PAYE) and Company Tax Return with Her Majesty's Revenue and Customs (HMRC).
Also, take into consideration that you would need to get a registered company address as well as pay rent and charges for maintaining this address. You may also consider forwarding your correspondence to your address abroad.
In addition to running your business legally in the UK you will also be required to do the following:
File financial statements: All businesses incorporated in the United Kingdom are required to file their financial statements, a summary of financial activities for the fiscal year, with Companies House.
Pay Corporation Tax: All companies must register with Her Majesty's Revenue and Customs and pay Corporation Tax on trading profits, profits realized from company fund investment, and as well as capital gains. A director of a UK company who is not a UK citizen will be required to fill a personal self-assessment tax return with HMRC but will only need to pay UK tax on any remuneration and benefits earn in the UK.
Maintain accurate records: Business records must be precise, kept up-to-date and stored for a minimum of six years.
So, registering and running a business in the UK as a foreigner is possible and we know you can do it! The entire process just requires careful planning, research, and preparation in order to succeed.