Opening a company in the UK as a foreigner

Starting a company in UK as a foreigner is an increasingly attractive option for entrepreneurs who want to establish a business outside their home country. This is because the United Kingdom has a favorable business environment, a reliable legal system, and a strong economy.

Even if you are not a resident of the United Kingdom, there are multiple legal and administrative routes that make this step possible.

Below, we present a detailed guide to establishing your business as a non-resident, covering everything from visa types to key legal requirements.

Steps to starting your company in the UK as a foreigner

Step 1: Apply for your visa to start a company in the UK as a foreigner

Before launching your project, it is crucial to review the available immigration options. There are several routes that allow entrepreneurs to legally settle and carry out commercial activities in the United Kingdom.

Business Visitor Visa

This option allows entry into the country for a maximum of six months to perform specific tasks related to future ventures.

Permitted actions include attending meetings, signing contracts, conducting market research, or receiving information from local clients. It is ideal for those still in the planning or research stages.

Exclusive Representative of Foreign businesses

Organizations based abroad can send a representative to establish a presence in the UK. This person acts as an authorized representative to open a branch or subsidiary, as long as the business does not yet have formal operations in the UK.

Innovator Visa

Intended for individuals with a creative, scalable, and viable business proposal.

To qualify for this option, it is necessary to have the endorsement of an accredited body, demonstrate prior experience, be proficient in English (B2 level), and have available funds for maintenance and initial development (minimum £50,000).

This option allows the entrepreneur and their family to establish a legal basis, with the possibility of permanent residency after three years.

Startup Visa

Similar to the previous one, but aimed at new entrepreneurs. No initial investment is required, although validation of an innovative business idea by an accredited body is required. It provides a path to residency after five years of residence.

Step 2: Choose the type of business in the UK as a foreigner

The next step is to define the appropriate legal structure. The most common options are:

Sole Trader: Ideal for those who want to operate individually and maintain full control over profits.
Limited Company: The most popular legal form, as it legally separates the owner from the business.
Partnership (LP or LLP): Recommended for those who start a business with partners.
Branch: A valid alternative if you already have an established organization abroad.

Step 3: Choose your company name in the UK as a foreigner

Your business name must comply with the regulations of Companies House, the official registration body for organizations.

It must be unique, avoid offensive terms, and not contain unauthorized restricted words. Availability can be easily checked on the official website, preventing future legal issues.

Step 4: Register your company with Companies House

Whether you decide to opt for a limited company or a partnership, registration with Companies House is mandatory. To complete this process, you will need:

Basic organizational details: name, address, entity type.
Details of directors and partners.
Description of business activities.

This process can be completed online for a fee of £12. Once validated, you will receive a registration number that legally proves the existence of your business.

Step 5: Register your company with HMRC

It is essential to register with the British tax authority, HM Revenue & Customs (HMRC), and comply with tax obligations. These include:

Corporation tax: Businesses pay 19% on net profits.
VAT: If your annual turnover exceeds £85,000, you must register and apply this tax to your services or products.

Additionally, if you hire employees, you must manage their social security contributions and make the corresponding withholdings.

Step 6: Open a Business Bank Account

Having a dedicated bank account for your organization is essential to manage your finances professionally. Banks typically require proof of business registration, directors’ identification, and a registered address in the country.

Step 7: Obtain Business Insurance

UK regulations require certain businesses to have adequate insurance policies. Some of the most common include:

Public Liability: Covers damages to third parties.
Professional Liability: Protects against errors or negligence.
Employee Insurance: Mandatory if you have hired staff.

Conclusion

Establishing your business as a non-resident in the UK is a completely viable option, provided you follow the appropriate steps. Obtaining the appropriate visa, defining the correct legal structure, and complying with tax and legal obligations are key aspects of achieving this.

With the right advice, your idea will become a reality in one of the most dynamic markets in the world.

Do you want to take the next step? We are here to advise you on setting up your business.