How to Form a UK Subsidiary

International organizations benefit a lot from setting up a UK trading subsidiary. Some of the benefits of setting up a UK subsidiary for an international organization include:

  • Greater access to sources of capital through the UK public markets
  • Customers enjoy comfort since the organization operates as a sales platform in the UK and all over Europe because they are dealing with a UK company
  • Offering tax and regulatory benefits
  • Allows international organizations to provide incentives to UK based staff by giving the staff shares in the UK Company
  • International organizations can ring fence the UK venture, which helps them to protect the stable overseas business from a significant liability.

You can rely on experts to guide you through the process of incorporating a new UK subsidiary company as well as managing it to ensure it adheres to the standards. Additionally, you can have your company listed on the public market by consulting experts. It is good that you consult the expert directly to get advice based on your specific needs. However, here are common considerations people who incorporate a UK subsidiary face.

Company formation in the UK

Most UK subsidiaries are private limited companies. An article of association is an essential document required in the incorporation of UK companies. You can adopt model articles prescribed by the government. The content of these articles is standard since the government provides certain necessary provisions; thus, it is the easiest to apply. The other way is adopting a set of regular articles. It entails sophisticated provisions, and it covers more details than the previous model. Additionally, a company can adopt a fully tailored set of articles. It is a standard mode, especially if the company has many shareholders and they want to state out their obligations and rights. The articles of association outline the powers of shareholders.

Statutory compliance

Companies need to meet the necessary statutory requirements. However, the legal compliance rule for UK corporates is pragmatic as compared to other European rules. Corporations should adhere to the stator compliance to avoid fines, criminal and civil proceedings. Companies House has the authority to strike a company off the register if it fails to meet its obligations. UK companies should comply with these areas among others listed in this guide:

  • Relevant filings for Companies House
  • Maintenance of the statutory registers of the company
  • Compliance with the Companies Act 2006


Corporate tax

The tax residency is usually determined by evaluation of the tax position of a company. A company qualifies to be a tax resident in the UK if the directors are residents and decisions are made in the UK. However, if decisions are made in the parent company overseas or if the directors run the company from abroad, then the company’s tax resident will be overseas.

Legal requirements

Setting up a company in a new country requires a host of legal requirements and regulatory. Some are generic to all businesses while others are specific to a given industry. The requirements in the UK include compliance with data protection legislation and e-commerce legislation.

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