Relocating Business to the UK: FAQs

Understanding the process of filing tax returns and changes in tariffs and customs can be intimidating for a business. If you plan to move your business to the UK, you will have to understand the different types of taxes and how they work. Answers to some frequently asked questions will help you get started.

What is the UK's Value Added Tax (VAT)?

The UK's value-added tax is just like the USA's sales tax. The standard rate of VAT was increased in 2011 from 17.5% to 20%. This is a generic VAT, but the VAT rate business charge is not the same as it entirely depends on the goods and services offered by the business. A trading agency must register for VAT if the total turnover exceeds £85,000 per annum. 

Can you explain the tax on employee benefits? 

Employees working in the UK are taxed on their employers' benefits. Individuals will be taxed on medical insurance and company cars as well. 

What are the requirements of National Insurance in the UK? 

Individuals who pay National Insurance qualify for certain benefits and state pensions. The people who are supposed to pay NIC include:

  • An individual who is self-employed and makes a profit of £6,515 or more per year
  • An employee in a company earning above £184 a week

The amount paid completely depends on the amount that the individual is earning over the lower earnings limit.

How do I pay corporation tax in the UK?

The accounting year of every company is different, which means that the filing and payment of corporation tax will vary too, making it even more tricky. A company tax return form will be submitted to HMRC every year. 

You will have to log into your HMRC account and choose a payment method. You will be given the following options: 

  • Direct debit 
  • Online payment 
  • Via your bank 
  • Company credit card 

You can't pay through personal credit cards or through the post office.

How will Brexit affect my business?

Brexit has already impacted the traders' market on a massive scale. With more tariffs, taxes and other customs implications, your business will have to opt for local trading. The trading of your goods from and to Great Britain will be affected by these tariffs.

What do you have to pay Capital Gains Tax on?

This tax is paid on a certain profit that an individual gets after selling a business asset. The business assets that are included in capital gains tax include: 

  • Registered trademarks 
  • Lands and buildings
  • Machinery and equipment 
  • Business's reputation 
  • Fixtures and fittings 

Capital gains tax is also payable if you are a sole trader or a business partnership. Limited companies pay corporation tax on profits from selling business assets. 

When will HMRC pay interest on my corporate tax?

There are two possibilities on which HMRC will pay interest on your corporate tax. These possibilities are: 

  • If you paid the tax early, you will get the interest from the date you pay your corporation tax to the payment deadline. 
  • If you paid more than your company owes, you will either be paid when the tax was due or when you paid it if it was after the due date. 

What are the ways to tell HMRC about a change in my business? 

If you are a sole trader or in a partnership, you can write to the latest address of HMRC or simply call the income tax helpline and tell them about your change in address or payroll. 

For corporation taxes, you can write to the corporation tax office by checking the recent address from tax forms, or you can call their helpline.

You can contact the HMRC employee helpline or write to the employer's office to update PAYE information. 

If you're considering moving business to the UK, it can be overwhelming with all of the tax considerations. Lawrence Grant has been assisting clients work across borders seamlessly for decades. If you need assistance navigating this change to your business, reach out to us today for support.

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