Offshore Company Formation – United Kingdom

The United Kingdom is the most stable and reputable jurisdiction. The legislation of many countries is based on its Common law. An offshore in the UK is the best option for trading, e-commerce, inheritance purposes, real estate, protection of assets, etc. Companies are registered in the form of a Private Limited Company (Ltd) or Limited Partnership (LLP). The major corporate act is the Companies Act 2006, and Companies House regulates any corporate affairs.

Basic Information and Calculation of Expenses

Non-resident companies or funds in the UK carry out business or trade outside the country and have no a status of residents. A company’s directors and shareholders may be of any nationality. The company’s secretary and address are obligatory. There are no limitations on trading activity except for a few actions that require additional license. It is also possible to incorporate a company in Scotland in the form of a Limited Partnership.

The incorporation package for UK offshores costs USD 600-2100 for Ltd and USD 800-1500 for LLP. Accounting services are USD 420-3000 depending on a number of transactions.

Optional services include notarization (USD 150), a bank account (from USD 300 to USD 900), courier services (USD 100), fax services (USD 300), VAT registration if a company carries out business in the UK (USD 900), Power of Attorney (USD 300), and additional certified copies of documents (USD 300-400).

Setup Procedure

The registration procedure takes 2-3 working days (notary certification takes 3-4 working days, and 3-5 days for delivery of documents). Same day registration and Apostille are available for additional charge. Due to fast registry a company may be incorporated electronically within one day.

Incorporation procedure consists of the following steps:

  • Selecting a corporate name for a new company, its checking and confirmation with Companies House.
  • Considering corporate structure (number of directors and shareholders), the share capital, nominee services if needed.
  • Preparation of the documents. Both individuals and legal entities are entitled to form a company.
  • Payment of fees and duties.
  • Filing the documents to Companies House and incorporation of the company. Upon registration the company’s officers will appear on public record. In order to avoid their appearance nominee services are available for clients.
  • Notary certification and Apostille.
  • Delivery of the documents to the client by courier. Translation services if necessary.

Taxation in the UK

In accordance with UK Revenue & Customs if a company is not resident of the UK and carries out its business outside the country it won’t pay income tax. Note that a company’s shareholders should be non-residents, too. The offshore income includes wages, royalties, dividends and rent obtained overseas. Scottish LPs only submit a simplified form of Tax Return.

Accounting Requirements

Offshore companies are required to prepare and submit accounting documents to Companies House. They also submit form OS AA01 stating accounting principles, whether the accounts have been audited, etc. Offshore funds submit form CISC2. Audit is obligatory; however, there are certain conditions which release a company from audit: number of employees should be 50 or less and annual turnover should be no more than 5.6 mln GBP.

Advantages of Offshore Companies in the UK

  • Reduced tax liability.
  • The most reputable jurisdiction with flexible and transparent business laws.
  • High level of privacy and enhanced confidentiality.
  • Protection of Assets.
  • Nominee services are available. Resident directors are not necessary.
  • Easy operation and maintenance.
  • Paid up share capital may be just 1 GBP.