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UK Branch Limited Company

A UK Branch Company provides you with a UK limited company for your UK operations and operates as an extension or representative of your existing foreign company.

The 2 limited companies work together to help you optimize your taxation regulations and enhance your ability to trade on a global scale.
We will incorporate a UK branch of the overseas company in the UK which will pay corporation tax on the profits derived from your UK operations. The UK branch company may also apply for VAT and obtain a UK bank account.

The UK Branch Structure

A new UK private limited company is incorporated as a branch of the foreign parent company. Branch companies do not require a natural person director; the director may be the Parent Company.

The UK branch may choose to have the same name as the parent company. However, should it decide to incorporate using a different name, the company name must comply with the naming regulations set out in Part 41 Companies Act 2006.

A UK resident representative (individual or corporate) is required for the purposes of administration of tax. A Company Secretary may fulfil this requirement. We are also able to provide a Nominee Secretary service for this purpose however we will require the director of the parent company to sign a resolution to state that the Nominee is not liable for the operations of the branch company and purely appointed for UK Company Law purposes.

The UK branch is required to file annual accounts which include any and all activities carried out by the branch and its parent foreign company, in the UK. It is not required to file annual returns.

Taxation

The UK branch is considered a permanent establishment of the non UK resident company and is not a separate legal company from the parent.
A branch of a non-resident company must appoint an individual or a company to represent it in its dealings with the tax authorities. The representatives may be held jointly and severally liable for the tax debts of the permanent establishments of non-resident entities, which they represent.

Taxation on company profits can be divided into Taxation on profits derived from business in the UK and taxation on profits derived from business outside of the UK.
The UK branch company will be responsible for payment of taxes on all profits received in the UK at the rate set for corporation tax in the UK. Currently this is 22% of profits. The UK branch is also responsible for VAT and PAYE of any operations in the UK.

The Parent company will be responsible for taxation on all income derived outside of the UK and will maintain its obligations as per the rules of the jurisdiction in which is it incorporated.

Accounting

The UK branch company is required to deliver accounts to Companies House annually that include also the accounts of the parent company and not solely the accounts of the Branch Company.

The accounts need not be audited but should be prepared by a professional accountant either in the UK or in the jurisdiction of the Parent company.

VAT

Much like a standard Private Limited company, the Branch must apply for VAT if its turnover in the UK exceeds £81,000.

The costs are as follows:

  • Incorporation of the Branch - £300
  • Nominee Secretary for the Branch - £100

You will also need to provide us with an apostile (or similar) of the parent company corporate documents. This document will be filed at Companies House as part of the Branch registration process.

After the company is formed you will be able to open an account with most UK banks however it should be noted that the ultimate beneficial owner of the parent company will need to be present or if this will not be feasible then it is advised that the branch also appoint a natural person director who is able to visit the bank in the UK. Non-UK banks are also an option for branch companies. Additional support documentation for the parent company will be required in either circumstance.

 

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