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Business registration and support in Great Britain REGISTRATION OF A BUSINESS IN THE UK

Taras Miroshnychenko

Head of International Corporate Law and Fintech Practice

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miroshnychenko@prikhodko.com.ua

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Expert in fintech, crypto, and international corporate law with over 20 years of experience. Specializes in crypto licensing (VASP/CASP), iGaming business support, and international structuring, asset protection, and OSINT analytics for risk assessment and due diligence.

REGISTRATION OF A BUSINESS IN THE UK

COMPANY REGISTRATION IN GREAT BRITAIN

BENEFITS

Ease of doing business in the UK

One of the biggest advantages of doing business in the United Kingdom is the ease of doing business. According to the World Bank, Great Britain has one of the highest indicators of ease of doing business among all countries in the world (8th place in the world). There are several opportunities available in various departments from advanced manufacturing to IT.

Simple taxation system

As of 2017, the corporate tax rate is set at 20%. In addition, the UK has double taxation agreements through treaties with other countries, so most UK companies will not pay corporation tax on foreign dividends. The VAT rate is set at 20%.

Qualified employees

Another main reason for the transfer of activities to Europe is the large number of qualified workers. More than 30 million people are currently employed in the UK. The UK is also one of the few European countries where labor supply is expected to increase over the next 15 years.

Strong infrastructure for doing business in the UK

A strong infrastructure is important for the overall development of your business in any country. In the UK, infrastructure improvements are underway in areas such as energy, transport, waste management and telecommunications. The region’s focus on sustainable change and positive improvement ensures a solid foundation for successful business operations.

Corporate zones

The UK government has created enterprise zones to further encourage business expansion and investment. These are designated areas that offer tax benefits, government support and simplified local authority planning. As a result, EZs are an ideal destination for both new and emerging businesses.

What legal forms can be chosen?

There are four main legal forms of business in the private sector:

Sole trader

Sole proprietorship is the most popular structure for a startup, as well as the simplest.
You pay income tax on your profits (not corporate tax). Profits over £45,001 will be taxed at 40 per cent and profits over £150,000 will be taxed at 45 per cent.
Depending on your income, you may also need to pay National Insurance (NI) contributions.
Being self-employed does not necessarily mean that you are self-employed. You can employ staff as long as you notify the tax authority (HMRC) and comply with employment law.
Advantages of sole proprietorship
as a private entrepreneur, you do not pay registration fees
you have very few bureaucratic procedures
you are in full control of business decisions.
you also get to keep all of your business profits after taxes.
Disadvantages of sole proprietorship
The main disadvantage is that your business and personal finances are not legally separated. This means that if the company has debts or is sued, any liability can be covered by your personal wealth. This exposes you to more personal risk than other business structures, so may not be suitable for a startup with high costs.

Partnership

In a partnership, several persons sign a partnership agreement, which defines the terms of business ownership, the order of profit distribution, the distribution of liabilities, and the exit order of participants.
A partnership is similar to a sole proprietorship structure, except that there are at least two individuals.
There is no legal upper limit on the number of partners, although managing very large partnerships can be more risky.
Each partner is registered as a private entrepreneur and submits a separate tax return.
Your tax obligations and tax liabilities are similar to those of a sole trader.
Advantages of partnership
The advantages of a partnership are flexibility and simplicity with the added bonus of having more owners to run the business.
Disadvantages of partnership
In a partnership, all partners are jointly liable for all business debts.

Limited company (limited company)

A limited company can be created as a Private Limited Company (LTD) or a Public Limited Company (PLC). The key difference is that a PLC has the right to trade shares on the open market.
To set up a limited company, you must register it at Companies House.
Can have one or more founders.
The liability of participants is limited to the value of their shares.
Advantages of a limited company
The main advantage is that his finances are separate from yours. This reduces your personal exposure to financial risk, so if the business fails (or is sued) you are only liable for a nominal the value of your stake in the business.
Another big advantage is the tax regime: companies pay a corporate tax of 19 percent on profits. This can be significantly more tax efficient than paying capital gains tax, especially for higher rate taxpayers.
Disadvantages of LLC
One disadvantage is that a limited company involves a lot more administration. You’ll probably need a company secretary, and probably an accountant (although you can outsource both of these roles). You must submit an annual company tax return and full statutory returns to HMRC, and you are responsible for paying employee income tax.

Limited liability partnership

At least two persons are required to create an LLP.
The liability of participants is limited to the amount of the deposit.
An LLP is a popular structure for professional service providers such as accounting and law firms.
The partners manage the company directly, there is no need to hold a general meeting or create a board of directors.
Advantages of LLP
As in an ordinary partnership, each partner in an LLP registers as self-employed and files a separate tax return. But if the business fails, each partner is only liable for the nominal value of his share.
Disadvantages of LLP
The administrative burden of an LLP is the same as that of a limited company, so having an accountant and a company secretary is desirable (although not required by law).

What is needed to open a business in the UK?

Choice of name and organizational and legal form. The company name must be unique and end with a word or abbreviation that indicates the type of organization.
Business Address – You must have a UK registered business address. If you do not have access to a UK address, we can help you by registering your business with a prestigious address in London.
Director details – A UK company needs at least one director, although there can be more. It is necessary to collect and prepare data about this person.
Shareholders – If you register as a publicly traded company, you will need to issue shares when you start your business. For this you need at least one shareholder and all his data. It can be the director or another person.
Constituent documents. When you register a company, you need two sets of documents: the memorandum of association and the articles of association. These documents are essentially agreements about the responsibilities of the parties involved and agreements about how the business will be conducted.

What is the cost of registering a company in Germany? To answer this question, leave us your phone number.

How long does company registration take?

A standard electronic application to Companies House is usually processed within 24 hours. However, preparation of the structure, identity verification, obtaining an address, tax setup and account opening require additional time.

Who needs to complete identity verification?

Directors and persons with significant control — PSCs — must complete verification. Once completed, the individual receives a Companies House personal code used to confirm the relevant corporate role. Non-residents may also complete verification, including by using a biometric passport.

Where is the best place to open an account for a UK company with a non-resident director?

Since traditional UK High-Street Banks require a physical business presence, the fastest and most efficient solution for international companies is to open accounts with electronic money institutions (EMIs). Platforms such as Wise Business, Revolut Business and Payoneer are licensed by the FCA and provide full UK and international account details for transactions.

When must a company register for VAT?

The general threshold is £90,000 of taxable turnover over the previous consecutive 12 months or expected turnover during the next 30 days. Separate rules may apply to non-resident and cross-border models, so VAT should be analysed before sales begin.

Is a company required to file reports if it has not traded?

Yes, it is mandatory. Even companies with no operating activity must annually file so-called “Dormant Accounts” with Companies House and confirm the ownership structure through a Confirmation Statement. Failure to file these documents results in substantial penalties (from £150 to £1,500) and compulsory dissolution of the company, with its assets passing to the Crown.

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