International - Doing business in the UK
The UKTI’s 2014/2015 Inward Investment Report shows the UK continuing to strengthen its position as the leading European destination for Foreign Direct Investment (FDI), with the UK attracting the most inward investment projects since records began in the 1980s.
Our international inward investment experts can provide you with everything you need to successfully establish, manage and grow a business in the UK. They will work with you to anticipate and overcome any challenges you may face in setting up your business in the UK.
Our experts will help you to:
- understand the choice of entity available from which to operate your business,
- understand the tax issues arising from this choice,
- source UK funding for your operations (whether grants, bank, equity or other finance),
- advise on employment taxes and social security, VAT/sales tax and property taxes and reliefs,
- provide outsourced assistance for your finance function,
- plan for the impact of Brexit.
We can also introduce you to a trusted network of other professional advisers and help with location searches.
We will work in partnership with you to create a strategy to successfully achieve your business goals and timescales.
The UK is the number one destination for inward investment in Europe. Latest figures show that companies investing in the UK continue to succeed.
In addition to being one of the easiest European countries in which to set up and run a business, other benefits of locating your business in the UK include the internationally competitive tax environment, a world-class skills base, Europe’s strongest research and development environment, a proven long term return on investment for international businesses as well as, of course, an excellent quality of life.
Tax incentives such as R&D tax credits, low corporation rates and relief for investing in innovation technology all help to make the UK an attractive place to do business. As does assistance in the form of grants and financial incentives.
The Department of International Trade website covers in more detail the benefits of investing in the UK.
UK Tax incentives
The UK has always been a great place to do business and that remains the case today. In addition to the stable political, economic and social environment there are some key tax breaks that any potential inbound investor should be aware of.
- The UK Corporation Tax Rate is one of the lowest in the G20
- Low Social Security Rate for employers
- Attractive Capital Allowances and Annual Investment Allowance on the purchase of plant and machinery
- Enhanced tax deductions and even cash back for qualifying expenditure on Research and Development
- The UK Patent Box regime with an even lower corporation tax rate possible
In fact, PKF Francis Clark’s Innovation & Technology Tax Group have been at the forefront of considering the impact of the Patent Box legislation on UK based SMEs – indeed we authored the first Tolley’s Tax Digest on the subject.
Download our “UK Tax Incentives” factsheet for further information.
When considering the formation and set up of a business in the UK there are numerous elements that will require your careful deliberation in the very early stages of the project.
- How will you set up your UK presence?
- Do you understand your Companies House filing obligations?
- Do you need to register for Corporation Tax?
- Do you need to register for Payroll Tax?
- What must you consider in relation to Employment Law?
- Do you need to register for VAT?
- Will you require a UK bank account?
- How will you fund your UK venture?
- Are your contracts and agreements legally binding in UK law?
- Are arrangements in place for your bookkeeping and management accounts?
- When must you start filing statutory accounts and corporation tax returns?
- Will you require an audit under UK regulations?
In our “Doing Business in the UK”checklist we have addressed each of these questions in more detail to help you to get started. It is worth working through this checklist to ensure you have considered the basic issues in advance and that, where necessary, you have sought local advice on any specific issues with which you need assistance.
Grants and Funding
One of the attractions for companies seeking to establish a permanent presence in the UK is the availability of grant funding. This funding can make the difference in terms of a company investing either in the UK or another part of the world, or indeed not going ahead with its plans.
Our specialist grants team has many years’ experience of advising on numerous successful grant applications for overseas owned companies in a variety of sectors. The team has worked on a wide range of grant applications for overseas owned businesses, regularly securing grant offers of between £1m and in excess of £5m for inward investment projects.
The team’s track record includes successful grant applications for global businesses such as Kawasaki Heavy Industries, Pall Corporation and The West Company.
The majority of the more substantial grants available are for investment in land and buildings and plant and machinery, which result in the creation of full time, permanent jobs, although there are often smaller grants available for items such as recruitment, marketing, training and similar costs.
These grants will either come from the UK Government or from Regional Agencies such as Local Authorities and are very much driven by the location you are looking to invest in.
In addition to grant funding we can help secure bank and equity funding if required for your plans.
How can PKF FC help?
“Having a presence in the UK is a key priority for many international businesses. Our specialist International Services team assists businesses of varying sizes in setting up and operating in the UK. Introductions to the team can come via our international network with the Leading Edge Alliance, or through solicitors, other firms of accountants as well as national and local government agencies.
Our specialist team can:
- Explain the benefits of locating your business in the UK
- Talk you through some of the additional attractions of establishing your business headquarters in the South West of England
- Talk you through the fundamentals of setting up your business and the key accounting, legal and statutory requirements
- Handle the whole of your UK accounting operations, if required
- Explain the potential tax breaks
- Discuss the availability of bank, equity and grant funding
We are also very experienced in responding to the requirements of the parent company, both in terms of tight reporting deadlines and also complying with the regulatory environment applying to the parent company e.g. IFRS accounting and SEC reporting.