Why form a company in the UK and not your own country?
Here are 8 reasons why forming a company in the UK is the smart move. It can be as easy, if not easier, than doing it in your home country.
1. Low Staffing Overhead
You only need one person to form a limited company in the UK. This person is you. You can be director and shareholder. The shareholder is the owner and the director is the person who executes decisions for the company.
Other jurisdictions require you to have a company secretary or other person besides yourself. Some offshore destinations try to make maintaining a company easy but they don’t let it have only one person as the responsible party. Which leads to the next reason why the UK is better …
2. International Directors Are Acceptable
You can live in a foreign country and be the sole director of your UK company.
Foreign countries often stipulate that there has to be a local resident who is a director or other responsible person. This person has to be paid. This can increase your yearly maintenance costs significantly. You can be running at a loss before you’ve made a single deal.
Not so in the UK.
Your company has to have an address here but you can live abroad.
3. Low Fees
Companies House charges less than £20 GBP to set up at company at their site and the same when you file your annual return.
Other jurisdictions offer offshore company formations to make money. They are small countries and don’t have much income. So they charge yearly fees to maintain the existence of your company. Often you have to work with a specialist formation agent to set up and maintain your company. This greatly increases the ongoing costs.
The UK just wants inward investment and tax receipts. So, if your UK company hasn’t made a profit or is dormant, you will not be charged fat fees simply because it exists. You can put your money towards marketing and making a profit!
4. Ease Of Setup
If you have a minimal understanding of business terms you can set up a company yourself at the Companies House website, or, get a formation agent like ourselves to do it: https://www.registeredaddress.co.uk/company-formation/
All you need to know is who the director and shareholder is to be (you) and how many shares and at what value you want to issue, typically: 1 share @ £1 ea.
5. Ease Of Maintenance
You file 3 annual returns to the UK government to maintain your company:
1 administrative, to Companies House
1 financial, to Companies House
1 financial, to HMRC (the UK tax department)
They make it pretty simple, with an online filing service. This service can submit the two financial returns at the same time, which saves a lot of bother: http://online.hmrc.gov.uk
6. Low Local Taxation
Ok, the UK doesn’t offer super low corporate taxation, but it’s not bad. Currently it’s 20% at the lowest rate. This is worth paying because your company is registered in a …
7. Stable Society
The UK doesn’t do revolutions. Well, not in the past few hundred years. The English like to queue up and obey whatever laws are written by parliament. It is very rare to have serious civil disturbance. This writer recalls the Miner’s Strike and Poll Tax rebellions as being relatively civilised. In the first it was a minority, local grievance which was put down, and in the second, the fact the the middle classes got involved was enough for the government to cave in and change the system.
8. Good International Reputation
Britain has invaded most countries in the world and been at war with the rest. Strangely, it is not as universally detested as such acts might warrant. Go to diverse countries like India, Japan and Brazil and it’s likely the locals will find Britain quaint and interesting in a way that Germany, well, would not be!
There is still a lingering respect for British notions of fair play, good humour, legal process and civility which means that a company registered here can take on some of that respect.