Starting a business in the UK from abroad can be a great way to get your business off the ground. There are many benefits to starting a business in the UK, including:
- Strong local economy
- Access to a large market
- Favourable regulatory environment
- Several tax and financial incentives are available.
The UK is one of the most popular destinations for entrepreneurs looking to start a business. Setting up a business in the UK is also relatively straightforward, thanks to the availability of online resources and support from government agencies.
As a result, there has been a significant increase in the number of businesses founded in recent years, with around 50,000 foreign-owned companies in the UK. This trend looks set to continue, making the UK an increasingly attractive destination for international entrepreneurs.
How to Form a Startup in the UK in 4 Steps
Step 1: Pick a Company Name
Choosing a name for your business is an essential first step in starting your own company. You should keep a few things in mind when making this decision.
First, try to choose a unique, memorable name that’s not too long. This will help potential customers remember your business when looking for products or services you offer.
Second, make sure that the name you choose is relevant to the type of business you will be running. For example, if you are starting a tech company, you might want to choose a name that includes the word “tech” in it. Make your offering obvious.
Finally, you’ll need to pick a name that complies with Companies House rules. These are relatively straightforward: Your company name cannot be explicit, and it cannot be in use by another company. You can use a company name checker to see if yours is available.
Step 2: Choose Your Company’s Legal Structure
Once you’ve chosen a name and checked that it’s available, you’ll be dreaming of the marketing tactics and ways to grow your company — but hold your horses. Before you can start making money from your business, you’ll need to pick its legal structure.
The legal structure of your business has significant implications for how your business is taxed, the personal liability you face, and the paperwork you need to file. Therefore, it’s crucial to choose a legal structure that best suits your business.
Most foreign nationals starting a business in the UK form private limited companies. It’s relatively easy to register a private limited company, and having “Ltd” at the end of your name adds legitimacy to your business.
Other legal structures are available, such as:
- Public limited companies
- Sole proprietorship.
It’s a good idea to research each structure thoroughly before making a decision.
Step 3: Get a UK Business Address
While anyone globally can start a business in the UK, you must have a registered office address in the UK. When setting up a company in the UK, one of the requirements is to have a registered office address.
Your registered address is where Companies House and HMRC will send official correspondence, and it’s displayed on the public register at Companies House.
But don’t start searching for commercial real estate in the United Kingdom; your office address doesn’t need to be a real office. You can use a friend or family member’s UK home address as your registered office with their permission or a virtual office service for a small monthly fee.
A virtual office address is often the best option as they usually offer:
- A business address in a prestigious location (usually London)
- Mail forwarding services
- Ongoing customer support and advice.
Step 4: Register Your Business in the UK
With your company name, legal structure and office address sorted, you’re nearly ready to start trading in the UK. There’s just one thing left to do before you can start making money from your UK business: register with Companies House and HMRC — the UK’s tax authority.
Registering a business in the UK is slightly different depending on which legal structure you choose. Most people decide to start a private limited company and will need to register their business with Companies House and provide the following information:
- Business name
- Company address
- Shareholder information
- Information about the director
- Articles of incorporation.
While the process is relatively straightforward, it can be tricky if you’re new to the process. Many entrepreneurs choose to use a company formation agent to handle registration. Formation agents are experts in registering companies and will ensure your application goes off without a hitch.
With your business registered, you’re good to go. You can get your business off the ground and start making money from the UK market.