How foreign entrepreneurs can register a UK company step-by-step guide
A stable economy and a venture for the global economy attract foreign entrepreneurs. The United Kingdom is one of the countries among which foreign entrepreneurs are looking to tap into the global market due to its strategic location of attracting investors and the international market. This makes the UK the perfect destination for foreigners to register new company in UK and tap into the global economy.
However, setting up a limited company as a foreigner can be challenging since one may not be conversant with the legal legislations and requirements. This guide will highlight how foreign entrepreneurs can register a company in the UK and the requirements for successful incorporation.
Understanding how a foreign entrepreneur can register a UK company
As a foreigner, it is essential to understand the UK legal requirements for registering and operating businesses. All entrepreneurs, residents, and non-residents, must form a company that complies with the Companies Act 2006.
Before delving into the process of company registration in the UK, it is necessary to understand the requirements to start a business in the UK. They include:
– Company name
– Shareholder details
– Director details
– Registered address
– PSC details
– Memorandum of Association
– Articles of Association
Company name
Every business must have a name for brand recognition. In the UK, there are rules to follow when choosing a business name which include:
– The names associated with limited companies must end with ‘Ltd’ or ‘Limited’. If the company is registered in Wales, the name must end with ‘Cyfyngedig’ and ‘Cyf’.
– Business names should not contain sensitive words or expressions such as English, England, British, Insurance, Parliament, His Majesty, and many others. All sensitive expressions and words can be found on the Companies House website.
– It should not suggest any connection with the government or local authority. To use it, it’s necessary to get permission.
– The company name should not be offensive.
Additionally, it is essential to ensure the name is unique and distinctive. The name must not be the same or similar to the names of existing companies. Availability of the proposed name can be checked on the Companies House name checker.
Directors’ details
Companies should have at least one human director. The required information for a director includes their age, which must be at least 16 years, their name, residential address, and nationality.
Shareholder’s details
Ensure all shareholders’ details are obtained, including their name, age, nationality, registered agent address, class of shares, and number of shares. A shareholder is not required to be a UK resident.
Registered address
A registered address is required to set up a limited company in the UK. A registered office address must be located in a physical location where the company is registered. If a company is registered in London, its registered address must be in London.
According to the Companies Act 2006, a registered address must be where correspondence is sent and acknowledged by a representative on behalf of the company. A P.O. Box cannot serve as a registered address.
One might wonder how to obtain a registered address as a foreign entrepreneur. Service providers offer virtual office addresses that are legal for use as a registered address. Virtual office addresses are legal for business registration in the UK.
PSC details
People with significant control (PSC) are individuals who hold significant influence over a company. This control may encompass ownership of a substantial share, the authority to appoint directors, or dominion over the company’s finances. The details required for PSCs encompass their name, country of residence, nationality, date of birth, and service address.
Memorandum of association
A company requires a memorandum of association, a legal document, which states the company’s name, location, business activities, external boundaries, constitution, and objectives. This document also defines the company’s structure and purpose.
Articles of association
This document contains the company’s rules and regulations that govern the company. It lays out the purpose of the company, capital structure, financial records, powers and responsibilities of directors and shareholders, how tasks can be accomplished, and how shareholders should exercise their powers and control.
Now let us dive into how to register a company in the UK as a foreigner.
Company structure
There are various company structures foreign entrepreneurs can use for company formation in the UK. They include:
- Sole trader
- Limited company
- Limited liability partnership
In the UK, foreign entrepreneurs must ensure their immigration status allows them to operate as sole traders. While sole trader is an option, most foreign entrepreneurs choose to register their business under the limited company structure for liability protection.
To register a private limited company, it is not required to have a visa and travel to the UK for company formation. This structure allows for online registration and operation from any location.
Standard Industrial Classification of Economic Activities (SIC) code
The SIC code explains business activities. Every business activity has a code which must be chosen when registering the company.
Registered Address
Choose a service provider that offers a virtual office address for company formation and correspondence. It is advisable to check their reviews and rates to ensure the service provider is reliable and that the same addresses are not being used by two businesses simultaneously. Service providers like Icon Offices ensure their customers receive a unique address and office number, which will solely be used by one business only.
The virtual address can serve as the company’s registered office address and directors’ service address. Service providers assist in handling mail and offer other additional services to facilitate business operations.
Company registration
There are two ways a foreign entrepreneur can register their company in the UK. One way is by using the Companies House website and the second one is by leveraging company formation agents.
Companies House provides a guide for registering a company through its website, which, once submitted, results in incorporation within 24 hours.
On the other hand, company formation assists entrepreneurs with all the necessary paperwork and ensures that their company is formed in accordance with the Companies Act 2006. Authorised by Companies House, company formation agents manage the entire process, streamlining the complex procedure.
Apply for business licenses or permits
According to business activities, it is essential to research what licenses or permits are required for registration. This ensures compliance with the legal requirements of local authorities in the UK.
Open a business bank account
Once a business is registered and has started trading, opening a UK business bank account is possible. This helps in separating transactions from the business, making it easier to track profits, losses, and expenses.
In conclusion, business registration in the UK is beneficial for thriving entrepreneurs who want to tap into the global market. The registration process of a company in the UK is simple and direct with good advice. Company formation agents, such as Icon Offices, facilitate an easier and more effective registration process for foreign entrepreneurs in the UK.
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