Arguments for Starting A Business In United Kingdom
Investors who desire to expand their US businesses to Europe should definitely consider the UK (specifically London) as a favorable place to settle their businesses. The country is ranked as one of the most popular destinations for legalizing foreign business in Europe. This is proven by the fact that more than 8,400 US companies call the UK their home. Such famous enterprises as Linkedin, Airbnb, and General Assembly have their offices on the territory of the country.
Although a shift to the EU market may cause some concern, the offered conditions and a developed business environment are favorable and fairly familiar. For those business owners, who doubt entering the EU market via the UK, the following reasons will reassure their future prospects and flourishing.
1. Paying attention to the digital economy and tech business boom
The list of enterprisers present in East London’s Silicon Roundabout totals over 2,300 businesses with the number of digital tech staff of more than 50,000 persons, which means that the city is the perfect venue for a tech activity of any kind. Note that the country is called the fintech capital of the world. So, your business benefits a lot from this destination.
As for the digital economy, this segment is rather promising and quickly developing. Note that it is the UK that took the first place in the rating of countries with the greatest amount of annual investment. The amount of foreign investments was £2.99 billion, which is an all-time record for the venture capital scene. For comparison, the amount of money invested in France, Ireland, Germany, and Spain taken together is less. The country’s reputation on the business scene is enhanced by the presence of such giants as Facebook and Amazon.
Although the majority of all enterprises and tech corporations are based in London, other cities are also are home to many well-known businesses. For instance, such brands as Skyscanner, TV Squared and Administrate are located in Edinburg. The staff of employees engaged in the digital domain totals 50,000 people in Manchester only. Generally, the digital sphere offers 1,50 million jobs.
While Manchester serves as the main country’s tech hub and hosts MoneySuperMarket, other examples include Newcastle that houses ImpulsePay, Liverpool with its flourishing environment for the gambling industry. Cambridge stands as a separate milestone in this list since it produces both intelligent specialists and hosts advanced businesses in the sphere of tech and digital economy.
2. The workforce and recruitment
The UK economy is distinguished by a high level of the workforce that totals 30 million. The indicator is the second-largest throughout Europe. The range of experienced specialists is wide; moreover, further labour growth is predicted for the next decade.
There are two crucial points that determine UK competitiveness on the labour market. Moreover, the country is not simply competitive in the sphere; it outstrips other European states in terms of recruitment. Firstly, the UK has flexible labour laws, which allow diverse businesses to easily adjust to the specifics of the country’s legal system. Thus, the UK law is favourable for various investors and meets their needs. Secondly, labour costs are lower if compared to other countries of Western Europe, which guarantees the UK thriving.
Although a slight fall was observed in the recruitment sector over the past decade, British citizens are intelligent and skilled. Despite foreign businesses will have certain difficulties in recruiting British staff, generally, workers are ready to adapt to the required styles due to their education and experience.
3. Gateway to other countries
London can serve as an intermediate chain on your way to wider world expansion. The country is characterized by perfect transport links with other world points. Thus, the UK can be the first step in developing business relations with other Asian and European countries for your business. While the city is home to diverse spheres of activity, including tech, art, green energy, etc., for a foreign enterpriser it means excellent adjustment.
If your target is to create a world-known brand based in two main geographical locations, namely the US and the UK – this option will benefit your business. The country has wide trade connections, which is proven by statistics. According to Trading Economics, exports from the country grew by 2.3% for just one month.
What does it mean for a foreign enterpriser? A businessman would have excellent opportunities for further exporting goods worldwide, resulting in worldwide domination on the global market. Moreover, UK products are characterized by high quality and have impeccable reputations; consumers tend to acquire goods with the Union Jack.
Brexit stands as the only concern about expanding business activity in the UK, bringing a certain degree of uncertainty about future prospects. Yet, with the fall of the pound, UK products have become more competitive abroad, causing the rise in export.
4. Financial Security
Now, the UK takes the 5th place in the rating of the largest world economies. It has managed to overcome Brexit uncertainty and entered 2018 with positive statistics. Today, the British economy is stable and flourishing.
The capital of the country is known as the world’s leading financial centre. Offices of large international banks are found in London. Foreign businessmen have excellent conditions in the banking sector. Facilities are customizable to the business community.
Britain’s taxation system is one of the main benefits of incorporation. Rates are favourable for starting a business activity. Thus, corporation tax is at 19%, which is the lowest for states of the G20.
Also, the UK’s system is distinguished by double taxation agreements with various states across the world, including India, France, etc. The essence of such treaties is that when exporting goods to third countries via the UK, US enterprisers won’t have to pay tax on income twice. Moreover, some states even agree to exempt income from taxation. This means that US companies can sell products abroad without being taxed twice.
The VAT rate is 20% currently. Most products and services (including some imported goods) are subject to this tax in Britain. For the R&D sector, the country offers various tax incentives applicable mainly to small and medium businesses.
5. Favourable business environment for entrepreneurs
Entrepreneurs engaged in various domains are welcome in the country. The UK is open to foreign entrepreneurs and has created a favorable environment for their businesses expansion. for example, an entrepreneur visa is issued and a special tax rate is applied to such companies. The income tax rate will be just 10% for the first £10 million in sale value. The country is the place where diverse industries flourish. Activities in the spheres of construction, healthcare, fintech, manufacturing are welcome. Thus, foreign businessmen can be sure of their prospects in the UK and further expansion to other states.