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Setting up Overseas

Buckinghamshire based MGI member firm Seymour Taylor is advising business owners to seriously consider setting up an overseas operation.  Similarly, the firm are experts in advising owners of overseas companies looking to set up a UK subsidiary.

According to partner Simon Turner, the key to setting up an overseas operation is early preparation and research.  “The fact that there are 27 EU member states means that cross-border trading can thrive,” he says.  “However, only 15 of these 27 member states have officially adopted the Euro as a common currency.  This fluctuating exchange rate coupled with differences in culture and business customs can throw up some tricky issues that need to be addressed.”

Provided these issues are taken into consideration early, however, Simon believes trading overseas can be a positive move for a lot of UK companies.  “Researching your local market is vital, but this needs to be put into international perspective,” says Simon.  “You need to be aware of cultural and language differences and you may even need to adapt or refine your product to suit the local market.  Local legal and financial regulations, such as accounting, taxation and employment requirements, are also a hugely important factor to consider.”

This is also the case for overseas companies looking to set up a UK subsidiary.  Simon’s niche area of expertise is assisting overseas companies with their UK subsidiaries, advising on the specific accounting requirements that they will not necessarily be familiar with.

“There are a number of important decisions to be made,” says Simon.  “One of the most important of these, for example, is selecting the most suitable entity with which to operate in the UK.  Within a month of establishing business premises in the UK, the company will need to register with Companies House, under either the ‘place of business’ or ‘branch’ regime.

“These are both treated differently for tax purposes, and also liability purposes.  The place of business regime, for example, requires the company to register the names and addresses of all persons authorised in the UK to accept notices served on the company, but is not necessarily a permanent establishment for tax purposes.  A branch on the other hand is taxable as a permanent establishment for UK corporation tax purposes.”

Being an international association of accountants and business consultants, MGI member firms have the capacity to call on global connections for specific advice on local accounting and legal requirements in over 77 countries worldwide.

For more information on UK subsidiaries, or on setting up an overseas operation of a UK company contact Simon Turner at Seymour Taylor on 01494 552100 or visit www.stca.co.uk