On this quick information, Speedy Formations’ firm formation specialists cowl 4 fundamental concerns for operating a UK enterprise from overseas. Additionally they reply frequent questions non-resident administrators usually have, similar to keep compliant.
Whether or not you’re beginning out or already operating a UK restricted firm, shifting overseas is an thrilling alternative. With an increase in hybrid and distant working, residing overseas whereas managing your UK enterprise is now completely inside attain.
Can I be a director and run my UK enterprise from overseas?
Excellent news: you’ll be able to run your UK enterprise from exterior the UK – be it in Spain, Dubai or past. Nonetheless, as a UK firm director residing abroad, you need to nonetheless adhere to those guidelines:
- Pay company tax on all firm income
- File annual affirmation statements to Firms Home, plus annual accounts on the finish of the monetary yr
- Submit your organization tax return to HMRC each 12 months
You’ll additionally have to submit a Self Evaluation tax return for those who obtain any revenue aside from a director’s wage.
What’s extra, you’ll want to fulfill obligations, similar to having a registered workplace handle within the UK, opening a enterprise checking account in your nation of residence, and understanding which taxes to pay.
Should you’re residing overseas and need to arrange a UK enterprise, registering a restricted firm is comparatively easy with the assist of a UK firm formation agent. Speedy Formations presents non-residents packages appropriate for non-UK residents from most international locations. These embrace necessities, similar to a London registered workplace handle and enterprise checking account referrals.
Step 1: Present a registered workplace handle
You’ll want a registered workplace handle and acceptable electronic mail handle to arrange a UK restricted firm. The registered workplace have to be a bodily handle within the UK and meet all regulatory necessities. Failure to conform may lead to your organization being faraway from the Firms Home register. Whereas the registered workplace handle is publicly out there, your electronic mail handle gained’t seem on the general public register.
Step 2: Open a enterprise checking account
Having a enterprise checking account within the UK isn’t a authorized requirement – you’ll be able to open one in your nation of residence. Nonetheless, many non-UK resident administrators favor to have one within the UK, because it helps with managing your UK firm’s funds. To take action, you’ll be able to:
- Open an account with a UK financial institution providing account providers to non-UK residents
- Legalise your organization paperwork to be used in your house nation
The selection is yours, however an organization formation agent will help simplify the method. For instance, Speedy Formations companions with Smart (previously TransferWise) to offer Smart Enterprise Accounts, providing entry to account particulars in over 9 currencies and extra.
Step 3: Perceive the enterprise taxes it is advisable pay
Desirous about operating a UK enterprise from overseas? Figuring out which taxes to pay is essential and will be advanced even for UK-resident administrators.
For enterprise tax, you’ll pay the identical company tax fee on all income and chargeable good points from the UK and overseas, no matter the place you reside.
Your UK tax residency standing determines what you pay for private tax. Your UK residential standing often relies on the variety of days spent within the UK through the tax yr (sixth April in a single yr to fifth April the next yr). For sole merchants, there’s no distinction between you and your UK enterprise. You’ll have to file a Self Evaluation tax return, together with your residency figuring out for those who’re taxed on UK revenue solely or worldwide revenue.
This could have important implications, so we strongly advocate consulting an accountant with expertise in non-UK resident tax issues.
Private tax implications for UK residents
You’ll solely be classed as a UK resident for those who meet no less than one of many automated UK exams:
- You spend 183 days or extra within the UK through the tax yr
- Your solely house is within the UK, and also you spend no less than 30 days there within the tax yr
- You’re employed within the UK full-time for any 365-day interval
Alternatively, you meet the adequate ties take a look at, otherwise you don’t meet any of the automated abroad exams.
For all above circumstances, you need to pay revenue tax in your worldwide revenue.
Private tax implications for non-UK residents
Should you spend fewer than 183 days within the UK throughout a tax yr, you’re thought-about a non-resident and solely pay tax on revenue from contained in the UK.
Non-resident administrators (NRDs) residing overseas for 183 days or extra in a tax yr should pay private tax on any UK earnings – even for minimal visits, similar to one assembly. Your nation of residence might also tax your UK revenue, however you may declare tax reduction if it has a ‘double taxation settlement’ with the UK.
NRDs don’t pay UK tax on dividend revenue until ‘split-year remedy’ applies. Nonetheless, UK company tax is deducted from firm income earlier than dividends are distributed. Dividend revenue should nonetheless be reported on a Self Evaluation tax return if required, and Nationwide Insurance coverage contributions might apply to UK revenue.
Step 4: Contemplate bills when travelling to the UK
Earlier than establishing or operating a UK enterprise from overseas, consider journey prices to the UK. Search specialist recommendation relating to on whether or not journey and lodging bills are taxable or exempt. NRDs travelling to the UK for enterprise should report any enterprise journey and related revenue to keep away from monetary or reputational dangers.
Keep in mind, utilizing a registered workplace handle service can even make it easier to keep away from enterprise journeys wanted for administrative causes, similar to accumulating your organization put up.
Non-resident administrators: FAQ
Establishing a UK enterprise from overseas or operating it abroad is thrilling however could also be daunting at first. To assist ease the method, check out the solutions to a number of the commonest questions non-resident administrators ask.
Does FSCS cowl non-UK residents?
The Monetary Providers Compensation Scheme protects clients by paying compensation when monetary providers companies fail. It covers non-UK residents and can defend as much as £85,000 in whole throughout all accounts you maintain. This implies you’ll be able to handle your UK enterprise overseas and relaxation assured that you simply gained’t lose all of your financial savings in case your financial institution or constructing society goes bust. Nonetheless, for it to use, the financial institution or constructing society have to be UK-authorised.
Find out how to keep compliant when working a UK firm from abroad
HMRC can simply establish compliance dangers for NRDs by reviewing short-term enterprise guests and cross-referencing Firms Home knowledge with PAYE Actual Time Info (RTI) submissions, which embrace data despatched to HMRC about NICs, revenue tax and extra.
Though compliance will be tougher for NRDs, failing to fulfill UK obligations or function PAYE or NIC the place wanted may end up in monetary penalties and reputational injury.
Luckily, detailed steerage is offered from the specialists at Speedy Formations.
Find out how to liquidate a UK restricted firm
You’ll be able to liquidate or ‘wind up’ your UK enterprise from abroad. Your organization will cease doing enterprise and using individuals, and it will likely be faraway from the businesses register at Firms Home.
The principles are the identical for all UK firm administrators: adjust to UK insolvency laws and search recommendation from a licensed insolvency practitioner.
Fortunately, you may make telephone calls, ship paperwork electronically, and have digital conferences together with your licensed insolvency practitioner to keep away from travelling to the UK.
Efficiently run your UK enterprise from overseas
Shifting overseas is an thrilling prospect, however preparation is essential. Earlier than you embark on this new chapter, guarantee you will have a UK registered workplace handle, an appropriate enterprise checking account, and a stable understanding of your tax obligations. Loads of sources can be found to information you, together with knowledgeable recommendation from firm formation brokers.
Attain out to the main group of specialists at Speedy Formations and see the way it’s simpler than ever to run your UK enterprise from overseas.