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The future for UK business

The UK is in the international spotlight at present as the first member of the European Union to signal its intention to exit irrevocably from the Union.

Much is being made of the uncertainty surrounding “Brexit”, which is compounded by the unexpected General Election to be held on 8 June 2017. However, there are measures that UK business and overseas investors can take to mitigate the uncertainty and risk surrounding the UK’s exit from the EU. Jordans as a VISTRA company is now uniquely placed to assist forward-thinking businesses and investors who intend to take action now.

Expansion outside the UK

UK businesses that are likely to rely on a “borderless“ access to EU markets should already be thinking about incorporating at least one subsidiary company within the EU, in order to ensure full access to the markets within the EU, in the event of a hard Brexit. Provided that any such subsidiary is incorporated under the laws of a Member State, and conducts genuine economic activity in a Member State, it will be capable of engaging the fundamental freedoms of the European Treaty.

Vistra have offices in the following EU countries from which we can incorporate and administer EU subsidiaries of UK parent companies:

It should be noted that a UK parent company receiving profit repatriation by way of dividend from any EU subsidiary company will normally receive the dividend free of UK corporation tax, and therefore without economic double taxation. This exemption is not something that “falls away” after Brexit, as it is enshrined in UK tax legislation. Moreover, proposed reforms to the UK’s “substantial shareholder” exemption (still likely to be enacted into UK law retrospectively from 1 April 2017) will enable UK parent companies to realise such EU investments free of further taxation in the UK. Another point of importance is that Brexit will not affect the UK's double tax treaty network with the EU member states thus ensuring that UK companies trading in the EU are protected from economic double taxation.

Vistra’s International Expansion specialists can help UK businesses get started quickly and successfully in the EU countries referred to above. Vistra have a track record in establishing companies in multiple jurisdictions, recruiting industry-qualified directors, setting up registered offices and putting in place every aspect of local administration.

Our specialist-service teams manage accounting and financial reporting; compliance; trading and treasury services; recruitment and payroll; international pension and incentive schemes and much more besides.

Foreign Investment

For foreign investors, the UK now offers significant opportunities:

  • The opportunity to trade in an economy that has held up very well to external pressures such as Brexit, and the global banking crisis of 2008.
  • The opportunity to trade in one of the largest economies in the world.
  • The opportunity to trade in a low-tax environment. The UK corporation tax rate is now only 19% and is scheduled to fall to 17% by 1 April 2020. Furthermore, overseas investors can repatriate profits from UK companies very tax-efficiently - there is no UK withholding tax on outward-bound dividends, for example.

Employer “on-costs” (e.g. national insurance) are also much lower in the UK when compared with many other EU countries’ equivalent regimes.

Whether you wish to explore the creation of an EU “footprint” for your UK business, or whether you are a non-UK business wishing to set up in the UK, Jordans, backed by Vistra's extended global reach, can offer you a one-stop shop.

 Martin Palmer


Martin Palmer
Consultant
T: +44 (0)117 918 1321
E:  mpalmer@jordanstrustcompany.com

 

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