Starting a business in the UK as a foreigner gives you the leverage to compete with local businesses. You need to register a company in the UK as a foreigner to achieve this (it’s advisable to work with an experienced local small business accountant like Howlader & co.). Approximately 15% of the UK workforce are registered as self-employed or sole traders. However, the best option across the globe even in countries like Canada, Estonia, Germany, South Africa, UAE and Nigeria is to register as a limited company. This article will show you what you need to start a business in the UK.
Economic Overview of UK
(Source Wikipedia )
The UK has a partially regulated market economy. Based on market exchange rates, the UK is today the fifth-largest economy in the world and the second-largest in Europe after Germany.
The UK service sector makes up around 79 percent of GDP. The creative industries accounted for 7 per cent GVA in 2005 and grew at an average of 6 per cent per annum between 1997 and 2005. The automotive industry employs around 800,000 people, with a turnover in 2015 of £70 billion, generating £34.6 billion of exports (11.8 percent of the UK’s total export goods). The aerospace industry of the UK is the second- or third-largest national aerospace industry in the world depending upon the method of measurement and has an annual turnover of around £30 billion.
How to Start a Business in the UK
Starting a business in the UK like every other business requires a business plan. A business plan will provide comprehensive information about the viability of the idea.
Therefore researching the market you plan on entering and preparing your financial forecasts is a key factor to the success of the business. The UK government’s website contains business plan templates and guides you can use in drafting your business plan.
If you already have an existing business, you would still need to write another business plan to accommodate your entry into the UK market.
Can a Non-Resident register a company in the UK as a foreigner?
Although surprising, the answer is yes. Non-residents can start a business in the UK.
The only requirement you need is a registered UK address. This address is mostly used for accountability and correspondence of business-related information.
You can get a UK address either by purchasing or renting a property, using the property of a friend, family member, or contacting registration agents to give you access to their virtual office for a fee.
Do you need a visa to register a company in the UK as a foreigner
Previously a Visa was needed to start a business in the UK. However, the government has reviewed that requirement. As a non-resident, you do not need to have a visa to establish a business in the UK. Setting up a business does not require you to provide proof that you are able to work.
However, this does not mean starting a business gives you access to travel to the UK to work under your company name. To do this you need a work visa.
Types of Visas for Entrepreneurs
- Tier 1 Entrepreneur Visa
Invested at least £200,000 in a UK business (This does not include a director’s loan or a commercial property loan).
You have to invest at least £50,000 if your first application was based on you having funds that come from an approved source.
You can typically stay in the UK for 2 years on a startup visa. You will not be able to extend the visa
People on a Global Talent visa can be self-employed or directors of companies and can live and work in the UK for up to five years at a time.
What non-residents who have set up a business cannot do
As a non-resident of the UK who has set up a business, you cannot:
- Work in another job in addition to working for your business
- Bring any member of your family with you
- Switch to a UK startup visa
- Work as a trainee doctor or dentist
- Settle in the UK with this visa
- Work as a sportsperson
- Get public funds
The process to register a company in the UK as a foreigner
According to the UK government website, you must fill your details and those of the company in form OS IN01 and send it to Companies House within 1 month of opening for business. The address to send it to them is on the form along with the required documents.
How much does it cost to process my application to start a business?
You also need to send a £20 registration fee with the form. This fee can be paid by cheque or postal order. If you are not confident of going through the process yourself, you should employ a registration agent in the UK to do the filling for you.
However, we have provided you with a complete guide to start a business in UK as a foreigner registration. Also, find links to the various forms you need to fill out.
Starting a new business in a foreign land or expanding into new markets can be a critical growth strategy that most businesses need to make. You also need to think and research if this is the right move for your business.
Cheers to creating new opportunities.
Image Credits: All images on this website are sources from Getty Images, Pexels and Unsplash.