Company Formation Procedure in United Kingdom (UK)

Setting up a company in European market should not be ruled out as other country markets. Approximately 25% of Global Wealth syndication is in European Territory.

It also has the biggest consumer market in the world. It is a synergy of 27 member states. The internal market for services to be around 4$ trillion by World Bank.

It is also one of the most highly skilled continents in terms of labor force & also technology.

Oversees & Strategic alliances are preferred with Europe because of the following:

  • Geography (Centrally located)
  • Historical Trading Ties
  • Cross-Border Syndication
  • European Union Policies effecting trade facilitation with various countries.

Also, there are comprehensive free trade agreements effected between US & European Union, fusing world’s two largest economies.

There are various Free Trade Zones in Europe offering Tax Exemptions for international investors:

  • Le Verdon Free Zone in France
  • Bourges Free Zone in Bulgaria
  • Duisburg Free Port in Germany
  • Liverpool Free Port in UK

There are certain Tax-efficient jurisdictions as well such as Guernsey, Isle of Man, and Jersey which are incentivizing economies around the world to invest further.

PRE-REQUISITES IN FORMATION OF A UK COMPANY:

 

  • A Company can be incorporated in UK with just one shareholder or one Director.
  • No Minimum Capital Requirements
  • Process is much quick & costing is low
  • No need to use a Lawyer, Magistrate or Notary. (However, it is strongly recommended by UK Law to have a legal counsel or Company Secretary for Oversees Directors who start-up business in UK)

 

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Steps In Incorporation of Company in United Kingdom :

  • Choose a company name & make a search on the online name application portal or directory.
  • All UK Companies must have a registered office space in UK Region only.
  • All the documents pertaining to Company Incorporation must be filed with Companies House in UK Government Agency.
  • Checkout Standard Industrial Classification SIC of Economic activities from Companies House; apt for the company.
  • Common Seal is mandatory if it’s an oversees incorporation for execution of the legal documents & verifying their authenticity.
  • In order to bail out the incorporation process along with the opening of the Bank Account for vetting, documents involved must be apostilled.
  • Certificate of Good Standing from UK Registry I.e. Companies House has to be issued which is an official document that verified the registration & status of the company in the picture.
  • Services of a certified accountant & a company secretary based in UK, must be sorted for in order to get the registration process smooth & legible.
  • Obtaining VAT Registration upon the applicability of local taxes from HM Revenue & Customs.

Company formation in United Kingdom is perhaps the easiest and least expensive country in the world in which to establish a limited company and the strength of the UK territory, together with the strong reputation that accompanies UK companies globally makes this country one of the most preferred locations to establish a business.

Within the European Economic Area (EEA), the simplicity of conducting business across international boundaries leads many business owners to choose the UK as their favored place of set-up. UK law, of course, places no trading restrictions on companies registered here so the company will be able to carry out its activities anywhere in the world.

Dependent upon local tax legislation, if a UK company does not carry out any trading activities in the UK and it is managed oversees, it is possible to be treated as non-resident for corporation tax in the UK. This may depend upon whether a ‘Double Tax Treaty’ is established between the UK and your country of operation.

Also, anti-money laundering regulations are checked with the KYC & AML Documents so that any illegitimate foreign capital is not entertained.

A Companies House should approve your company as much as 3–4 hours provided the filing is accurate.

FEE STRUCTURE:

  • Online filing through the inbuilt software — Standard Fees 10 Euros
  • Web Incorporation through Companies House Portal — Fees 12 Euros
  • Paper filing of IN01 Form to appropriate office — Fees — 40 Euros

TAXATION STRUCTURE:

The UK tax year dates are set from 6th April of one calendar year to 5 April of the subsequent year. Thus, UK tax year is often denoted as 2016/17 for the current tax year.

Most corporations in UK are levied 20% tax on their net profits, & should file a separate company Tax Return with HMRC. The applicable UK corporate tax rate depends on the level of company profits, applicability, as a foreign company with a UK branch or office, or if some other sort of an entity.

UK Dividend Tax is not required to be paid on the first 5000 GBP of dividend received in a tax year.