All business structures are changing and evolving. What was profitable during the previous decades, today it can be even unprofitable and what was unthinkable, today is an indisputable fact and indispensable for healthy business development.
According to Forbes, the UK has the 5th place in "Best Countries for Business" list, for 2016. But let's have a general look into the reasons.
Is well known that in order to form a Limited company in UK, you need just few minutes and a relatively insignificant amount to pay the Company House's procedural. After few hours you receive all your documents on your email and after few days, on your address at anywhere in the world. Then, you need approximately 10 to 20 days in order to open a bank account. And that's it - You are ready to conquer your business world, with your premium, UK based company image.
Someone could say that is not easy for all overseas people. Mainly, due to language barriers. But this is not true, there are many companies that provide such services in the language used by their clients. A first example, is our company - UPECO. We do offer full packages of a company formation, supporting it currently in additional two languages (Greek and Russian).
When we talking about management, we have straightforward perception on what it may include generally:
➤ Clients Obviously to make profit.
➤ Suppliers To have all the necessary support in terms of goods and services.
➤ Government To handle your statutory obligations, which are based on local laws.
➤ Banks For a smooth management of financial resources.
➤ Lawyers For the purposes of legal research, advice and protection of your rights (if needed).
To manage your accounting issues, statutory obligations and receive advice on tax issues.
Today, the technological structure of the UK enables you to manage your business completely from a distance. All the six categories above can be contacted today via digital tools, like Skype, phone, email etc.. To be honestly, all the looking forward companies (except some specific - traditional) tends to work via digital channels as much as possible. This is the future and every looking forward entrepreneur should embrace it. For example, one of the very useful digital tool, is that you can take online court action against someone if they owe you money and won’t pay you back. Click HERE to learn more.
Another advantageous aspect of a LTD company is the tax planning, where depending on your (or your accountant) knowledge, you can save a lot of money. Is not secret that there is a lot of regulation on how you can withdraw and allocate your money and subsequently pay taxes on them. The UK has one of the most flexible tax arrangements in respect of withdrawals.
Speaking generally, corporate tax for limited companies currently stands at 19% (please check the article creation date). But one of the most important things in this topic, is that the losses can be forwarded. Additional to this, the VAT registration is not compulsory - You need to pass the current threshold of £85,000. And this is fertile for new businesses with low income, making them more competitive into UK market, but not only. Moreover, the UK supports the innovative companies practically, making some activities, tax reduced or even free.
Also, is very interesting that at Budget 2016, the government announced a further reduction to the Corporation Tax main rate for the year starting 1 April 2020, setting the rate at 17%. So its more than obvious that the UK, at least on this topic, doing more than just "something" to lead in international business arena.
UNPREDICTABLE SITUATIONS & DISADVANTAGES
However, there are many people who thinks very defensive, asking the question such as - what if I will not succeed? Despite that we are far away from a negative thinking, we have pretty good news for our pessimistic readers. The procedures of a company dissolution are relatively easy as the formation, with exception for companies with assets and obligations towards third parties. But even in this situation is not so horrible. There is a lot of firms that can handle in full your company dissolution affairs without your presence.
Regarding the disadvantages, we could say that they are insignificant. Many people refers on this topic mentioning subjects such as complex accounting requirements, annual statutory obligations etc. But all these are just part of the business and they are relatively same as in any other country. We believe that there is only two main disadvantages.
Not suitable for undischarged bankrupts or disqualified directors
High accounting costs
Another questionable point, is the BREXIT issue, where views are divided. Definitely, the business community of the UK faces an uncertainty storm, but this is only in short terms. In long terms, there are many positive things we can expect. One of them is the fact that the UK will decide on how to regulate the businesses, rather than Brussels, as it happens now generally in many fields and therefore, we expect that all the decisions to be taken, will take into account the interests only of UK's companies and not of the entire community, such as the EU.
Despite the complicated subject of the BREXIT, where no ones know exactly what will gonna happen, we believe that there is no implication in long term, because the nature of adaptation will take place always and in a continuously revised process.
There is a lot of aspects that we could touch regarding a UK company, but definitely it needs a more subtle approach, which also requires the more and detailed information of a business. So feel free to contact us and arrange a Skype meeting, if you are interesting to form a company in UK. We will give you a more clear picture, taking into account the peculiarities of your business.
© 2017 UPECO LTD
Attention! This article intends to give only a general informative picture and should not, in any case, be taken as a rule. It is strongly recommended to seek a full and professional guidance specifically for your circumstances before making any decisions.