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If you’re looking to immigrate to the UK from South Africa, one possibility could be business relocation. We walk through the steps required to expand your business into the UK and how you might be able to sponsor your own UK visa.
With low corporate tax rates, business-friendly laws and very little red tape when it comes to setting up a new business, the UK remains a destination of choice for entrepreneurs, even post-Brexit.
For South African business owners who wish to move to the UK, UK business relocation could be the first step. This process can be complex, and you will need to follow the right steps to ensure everything goes smoothly.
1. Set up as a UK entity
Once you have made your decision about the type of branch it’s time to set your business up in the UK. Before finding a space for your business and setting up physically, there’s some admin that needs to be done.
Incorporating your business
It is relatively easy to incorporate a business in the UK. Your company will need at least one named director, a shareholder and a registered office address in the UK.
Certain documents are held at Companies House which can be accessed by the public. These include the incorporation documents, annual financial statements and changes within the company that must be notified to Companies House such as changes in directors, shareholders or the registered office.
Choosing a business structure
If you’re not starting a new business, then you will need to decide how you will be expanding your current business into the UK. You can either open a UK branch or establish a subsidiary. Each structure has its own pros and cons, and you will need to decide which one is best for you.
A branch is an extension of a parent company operating under the laws of another jurisdiction. It is not a separate legal entity. The parent company is liable for all the branch’s operations and its annual financial statements need to be filed at Companies House in the UK.
The benefits of operating as a branch:
- A branch is quick and easy to set up.
- A branch can be converted into a limited company or subsidiary at any further point.
- A branch can be closed without formal notice.
A subsidiary is an entirely separate legal entity from the parent company, meaning that the parent company is not liable in any way for any actions or decisions of the subsidiary. This gives the parent company protection in terms of liability if the subsidiary should make a loss.
The benefits of establishing a business as a subsidiary:
- A subsidiary is considered its own legal entity, so it can own property, can sue or be sued.
- A subsidiary is far more credible with UK suppliers and other companies as it is considered a UK company, meaning it is governed by UK laws.
- The parent company’s profits are shielded from being taxed by the UK government.
- The parent company does not have to file their year-end financial statements at Companies House
Expansion Worker visa
A possible route you can consider is the Expansion Worker visa. In May 2022, this visa replaced the Sole Representative of an Overseas Business visa. It’s open to both the business owner and senior employees of a business that has not started trading in the UK yet. Instead of only sending just one employee to extend your business, the Expansion Worker visa allows up to five representatives in the UK at the same time.
One of the main requirements of this route is that the business should continue to have its main operations outside the UK. This means that the route is not suitable for a complete transfer of the business, but solely for the expansion to the UK of a well-established business that will continue to trade overseas.
3. Register your company for taxes
When you register your business with Companies House, you will automatically be registered for Corporation Tax. Once you start employing people you will need to register for PAYE.
While some businesses register for Corporation Tax and PAYE at the same time as registering with Companies House, you will only have to register for VAT after you’ve reached a certain threshold of turnover.
When registering for Corporation tax, you’ll need to give HM Revenue and Customs:
- Your company’s registration number
- The date you started to do business (your company’s first accounting period will start from this date)
- The date your annual accounts are made up to
4. Setting up a UK business bank account
As a company trading in the UK, you will require a UK business bank account in order to conduct business. This can be a difficult and time-consuming process as it can a few months to open from outside the country. Before setting up a bank account for new customers, UK banks must undertake customer due diligence. This is part of the anti-money laundering (AML) regime and is a key requirement of the Money Laundering Regulations 2007 in the UK.
5. Register for auto enrolment
The UK requires all businesses to put certain staff into a workplace pension and contribute into it. This is known as auto enrolment. The Pensions Regulator is responsible for ensuring that all employers comply with workplace pension law. It’s important that you understand what you’ll need to do and prepare early.
What you need to do will depend on whether you have staff who need to be put into a pension scheme or not. All employers have duties, which include completing an online declaration of compliance to indicate what you’ve done for auto enrolment.
6. Get a sponsorship licence
If you want to sponsor yourself over to the UK or want to employ foreigners, then your business must apply for a sponsorship licence in order to do so.
Once your business is set up, you can hire your first staff member. They will need to be a British citizen or have indefinite leave to remain in order to serve as the authorising officer, who will take responsibility for the company’s sponsorship licence.
7. Apply for a Skilled Worker visa
When the sponsorship licence has been obtained, your business will be able to issue certificates of sponsorship and you will be able to sponsor yourself on a Skilled Worker visa if you meet all of the requirements.
Requirements for a Skilled Worker visa
The Skilled Worker visa is a points-based system where you will have to get 70 points in order to be eligible. The majority of the points (a core 50) will be given for a job offer from a licensed sponsor at the right skill level, with English speaking skills and the other 20 are tradable (meaning they can be gained in a number of ways).
Read more: FAQ: How to immigrate to the UK under the new points-based system
Your partner and dependents are able to join you on a Skilled Worker visa, if they meet the requirements. There will be additional fees for each family member included as well as additional immigration health surcharges (IHS) to pay.
This visa is valid for an initial period of up to five years, after which time it can be renewed (if initially issued for less than 5 years), or you can apply for Indefinite Leave to Remain (ILR). ILR gives you the right to live, work and study in the UK for as long as you like. After holding ILR for 12 months you are able to apply for British citizenship.
How our business relocation service can help
This can be a complicated process and you have to make sure that you have all your documentation and have done your due diligence. We understand the detailed processes involved in relocating your business to the UK. With our accounting expertise and global reach, we can help you make your business relocation a success.
Our business relocation services include:
- UK business registration and provision of a registered office
- Advice on working regulations and legal structures in the UK
- Immigration advice and solutions
- Payroll, VAT and Corporation Tax registration
- Accounting services and tax advice
- Facilitating international money transfers
- UK company secretarial services
Sable International helps clients from all over the world relocate, set up and manage new business operations in the UK. When looking at incorporating a limited company in the UK, their UK business start-up services will guide you every step of the way.
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- The UK skills shortage: Why it’s the best time to get a UK work visa
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