The United Kingdom is one of the most important commercial places in the world and the main destination of internal investments in Europe, but the growing companies still face some obstacles when it comes to expanding in the country.
The United Kingdom is one of the most important commercial places in the world and the main destination of internal investments in Europe. Its attractive commercial environment is at the peak of success, but companies still face several challenges when diversifying their operations in the country.
In general, expanding companies seek to move to an open market with good access to neighboring regions and a strong contribution of qualified work, research and development and a return on investment in the long term. The United Kingdom offers these attributes and more.
With a confirmed entry to the European Union market of $ 17 million, it is an unparalleled business environment awaiting developing companies with a competitive international tax rate. By 2015, the current corporate tax rate will have fallen by 20%, and innovative companies are able to benefit from an additional reduction in corporate tax through the imminent “Patent Box” initiative and recent improvements in the generous plan of tax credits of the United Kingdom in Research and Development.
Despite the obvious appeal, companies can find complicated and disparate laws, tax categories and other rather challenging bureaucratic issues. For this reason, having the appropriate local help can help make a difference in the success of the company.
Start a company
Starting a business takes an average of 13 days. Most of the time goes to His Majesty’s Tax and Customs Service (HMRC) and the income tax withholding record called PAYE (“pay according to what you earn”). Although no fee is charged, or a low fee is charged, the number of procedures can make the process quite difficult for companies.
Take care of building permits
Construction is a relatively agile procedure in the United Kingdom. It takes less than 100 days and requires only nine procedures. Obtaining a planning permit from the relevant authorities and the connection of water and sewage requires the greatest amount of time and is the most expensive element of the procedure.
UK Power Networks is in charge of the electricity connections and it may take 100 days to complete the procedures. This involves presenting plans, obtaining inspections and waiting for external connection works. Choosing an electricity supplier with the most convenient rates for you can also result in a minefield.
The registration of a property in the United Kingdom is the most difficult task when establishing a company in the country, according to figures from the World Bank and the International Finance Corporation. The tasks that demand more time are the searches of the property and the relations with the lawyer of the buyer, which require six procedures and take 29 days.
The United Kingdom ranks first in the world in terms of ease of obtaining credit. The solid financial sector and the diversified nature of the acquisition of loans offer both incipient and developed companies good access to the necessary funds. However, knowing what type of credit corresponds to each company is a daunting task that often requires assistance.
Protection of investors
The solids treated and a strong financial climate imply that investors are well protected in the United Kingdom, although it is always advisable to acquire guarantees and perform due diligence when expanding in the country.
The tax system in the United Kingdom is extremely difficult. This is due, to a large extent, to the fact that the country’s legal system has been adopted gradually. Complete the necessary tax obligations takes about 110 hours per year, which can involve from corporate and labor charges to taxes on sales and the environment.
Marketing in other countries
The United Kingdom is among the standard in terms of ease of marketing in other countries, with time, procedures and standard prices compared to its OECD counterparts.
Contract compliance and insolvency resolution
The fulfillment of contracts and the resolution of the insolvency are two relatively simple processes thanks to the developed nature of the legal system of the United Kingdom. The fulfillment of a contract takes less than 400 days on average, and the resolution of the insolvency, one year. Both are within the OECD average.
Often, the British give the impression of being quite reserved and distant, and it may take some time to get involved in the small details of business procedures. Time is an important factor, although making a decision can be a slow and difficult process that involves many people and bureaucratic issues.