JAMES COWPER IS IDEALLY EQUIPPED TO EASE YOUR EXPANSION INTO EUROPE OR THE UK. BY USING OUR KNOWLEDGE OF THE UK MARKET-PLACE, WE CAN OPEN UP A WEALTH OF NEW OPPORTUNITIES FOR YOU.
James Cowper’s specialist team understands the challenges facing organisations wishing to locate in the UK. We have many overseas subsidiary companies amongst our clients. We have connections in Europe and the rest of the world through Kreston International, a global network of accountants and business advisers.
James Cowper is also registered with PCAOB (Public Company Accounting Oversight Board) in the United States. Authorisation from PCAOB is now a legal requirement for any firm of auditors which wants to work with UK subsidiaries of listed US based companies.
Detailed below are a selection of frequently asked questions raised by people looking to invest or expand into the UK and Europe. We would be pleased to talk to you to discuss your business plans.
What contacts do you have in Europe and the rest of the world?
Why the UK and where do we start?
How do we choose the right location?
How do we find the right property?
What banking arrangements are appropriate and how should we fund the UK operations?
How can we find employees and how should we pay them?
What rates of tax will we pay?
Should we outsource the UK audit and accounting function?
How can we locate reliable UK business suppliers?
International Services Update
What contacts do you have in Europe and the rest of the world?
James Cowper is a member of Kreston International, a global association of independent accounting and business advisory firms. Kreston member firms operate from over 500 offices in 75 countries around the world and the network is expanding rapidly.
If you are looking to expand overseas from a new or existing UK operation, we can use the Kreston network to help you identify high quality firms throughout Europe and the rest of the world.
Why the UK and where do we start?
The UK Government wants to encourage multinational companies to the UK. Tax legislation has been introduced which now makes the UK a very attractive location for overseas investors.
Should you want to take advantage of these opportunities, James Cowper can help you through the expansion and cultural change process.
Our overseas clients have a wide variety of needs and our "in-house" team, together with our network of local contacts, can usually provide any help required.
Whatever your needs you can be assured that client relationships are of the highest importance to us. Every client has a dedicated partner who will keep in touch on a regular basis and ensure that we deliver a positive and value for money service.
Whatever your stage of expansion into the UK, whether you are a new
entrant or an established organisation, we would be happy to talk to
you.
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How do we choose the right location?
The right location for your operation is crucial, not only to maximize exposure to potential clients and partners, but also to increase your ability to recruit skilled people and obtain government grants.
Click here to view map of Thames Valley
About the Thames Valley
The Thames Valley is a UK region just west of London and served by London Heathrow Airport, which is a short drive from our three offices. The principal business locations in the region include Reading, Oxford, Bracknell, Newbury and Slough. As well as being close to Heathrow Airport, it has good road and rail links. With this good communication network and some of the world's leading universities, the area has become a focal point for inbound investment into the UK and a centre for technology, telecommunications, computer and internet enterprises.
Some of the world's biggest multinational corporations are located in the area including Microsoft, Vodafone, Oracle, Hewlett Packard, Oxford Instruments, Amazon.com, and Siemens. Yet at the same time it is the favoured location of many smaller dynamic companies testing out the UK or European market for the first time.
As one of the largest firms of accountants and business advisers in
the Thames Valley, James Cowper understand the business dynamics of the
region and we are excellently placed to advise new entrants to the area.
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How do we find the right property?
Depending upon your requirements you may wish to consider a serviced office. This provides maximum flexibility and usually includes secretarial support, boardroom hire and the use of fax and photocopying facilities. We can put you in touch with people who can help.
Similarly we can recommend property agents who will help with your search
for all types of property.
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Do we need a UK company?
Typically, companies operate in the UK either through
- a UK subsidiary company or
- a UK registered branch or
- a UK registered place of business.
There are a number of important tax, legal and regulatory differences between these options, the key ones being:
|
Place of business |
Branch |
Company |
Separate legal entity |
No |
No |
Yes |
Able to conclude contracts in own name |
No |
No |
Yes |
Registration with UK Companies House required |
Yes |
Yes |
Yes |
Filing of annual accounts at Companies House |
Overseas parent |
Overseas parent |
UK company |
Annual audit required |
No |
No |
Yes |
Taxable in the UK |
Possibly, depending upon the activities |
Yes, on profits of the branch activity and gains from UK assets |
Yes, on world-wide income and gains |
UK profits assessable on foreign parent |
Yes |
Yes |
Generally only if amounts are distributed |
UK losses available to parent |
Yes |
Yes |
Generally not |
VAT registration |
Unlikely |
Possibly |
Possibly |
Reviewing these factors in isolation is not enough. Your commercial requirements are crucial. At James Cowper we understand your business needs and we can help you conclude which operating structure is best for you.
Once a choice has been made, we can arrange for the necessary paperwork
to be completed as quickly as possible.
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What banking arrangements are appropriate and how should we fund the UK operations?
Opening a bank account
Setting up a UK bank account is often a first priority. We have good contacts with local bankers and we can arrange introductions.
Funding the operations
If the new operation is seeking finance in the UK we can discuss with you the most appropriate lending source. Again we have a network of contacts that you might find useful. We can help you prepare the necessary business plans and projections and attend meetings with possible lenders if required.
If group funds are to be used, we can advise on the associated tax issues
and opportunities involved with borrowing from overseas.
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How can we find employees and how should we pay them?
The recruitment, retention and motivation of employees will be key to your business success. Employees in the UK will be subject to different cultural and regulatory practices from your home country.
Using our own expertise and knowledge, together with our network of local contacts we can help you with a wide variety of people issues including:
- Advising on work permit requirements for people transferring from outside the EU
- Advice on local property markets, schools etc for relocating employees
- Introductions to local recruitment consultants
- Advice on tax-efficient remuneration and benefit packages
- Personal tax advice for key employees
- Advice on stock option plans
- A cost-effective and efficient payroll service
- Advice on payroll taxes
- Employment contracts
- Advice on the UK tax implications for your inbound staff, including short-term assignments and business visitors.
What rates of tax will we pay?
The UK Government wants to encourage multinational companies to the UK. As a result new tax legislation has been introduced which now makes the UK a very attractive location for overseas investors. The UK now has one of the lowest rates of company tax ("corporation tax") in Europe and has a favourable capital taxes regime to rival that of The Netherlands. In addition UK social taxes are lower than many of its European neighbours.
Corporation tax
In the UK both branches and companies pay corporation tax. The main rate of UK corporation tax is 30% but it is reducing to 28% from 1st April 2008.
Both initially, and as your organisation grows, your global tax bill can be affected substantially by the way your UK operations are structured. Our inbound team includes tax specialists who can advise you on a wide range of tax issues including:
- How should the UK operation be structured?
- What functions should the UK operation carry out?
- How much income should be recognised in the UK?
- How should inter-company transfer prices be determined?
- How can maximum advantage be gained from UK tax reliefs and incentives?
VAT (Value Added Tax)
VAT is the European sales tax. A UK VAT registered business must charge and account for VAT, currently at the rate of 15%, on its taxable supplies (sales). It is usually possible however to offset any VAT incurred on expenses that relate to business purchases.
We can help you determine whether a VAT registration is necessary or desirable and help with the periodic returns. We would review any planning opportunities to minimize your VAT cost.
Custom duties
If your products are liable to import duties, or if you export from your UK base, then we can work with you to ensure all custom duty planning opportunities are maximized.
Employee taxes
In the UK the social tax is known as national insurance ("NI"). NI contributions have to be paid by the workforce as a deduction from their gross salary ("employees NI"), and by employers ("employers NI"). The rate of employers NI is currently 12.8%.
Employers have an obligation to collect NI, together with UK income tax, and pay the amounts over to the tax authorities.
Where you are bringing staff over to the UK, we can advise on their social security position which may mean they stay in their home country system.
The tax team
James Cowper have a dedicated tax team which is recognised as one of the most experienced in the Thames Valley. The team is well regarded by the tax authorities and within the Thames Valley business community. Members of this team have specific expertise in helping inward investors maximize their tax opportunities. One of our tax parters, Sharon Bedford, heads the international tax group of Kreston International.
Should we outsource the UK audit and accounting function?
Many of our clients do not initially employ a UK accountant in-house and therefore look to outsource some or all of their financial and regulatory functions to a firm such as ourselves.
Whilst some of the basic processing can be done overseas there is usually a need to do some bookkeeping in the UK. In addition there are a large number of ongoing regulatory, legal and tax filings that are specific to the UK. Whilst non-financial staff can deal with some of these, this can distract from the key task of growing the business.
We have developed an efficient and cost-effective approach to outsourcing these services on your behalf.
This could include:
- Arranging initial tax registrations
- Producing accounting records
- Preparing management accounts and reports in a format and to timescales acceptable to the overseas financial reporting system
- VAT returns
- Payroll administration
- Corporate tax returns and associated tax planning
- Being the Registered Office and preparing associated statutory filings
- Annual corporate tax returns
Audit
Under current legislation a UK subsidiary of a foreign parent invariably
needs an audit, unless the group as a whole qualifies for exemption on
the grounds of size.
If you have an international firm of auditors we would be happy to liaise with them to ensure all the information is in the format required. Alternatively we could independently carry out a cost-efficient UK audit in accordance with UK audit standards. We use a computerised risk-based audit approach to ensure a rigorous audit is carried out.
James Cowper is registered with the Public Company Accounting Oversight Board. Authorisation from the PCAOB is a legal requirement for any firm of accountants carrying out audit work for UK subsidiaries.
The Sarbanes Oxley Act requires PCAOB audits to be carried out under US auditing standards. The Act also requires auditors to report on internal controls under Section 404 audit reporting for UK standards. Auditors of US holding companies normally accept responsibility for Section 404 audit reporting for UK subsidiaries, with the UK auditors assisting them in accordance with agreed procedures.
James Cowper has carried out PCAOB audit work and assisted management with internal control reporting under Section 404. This work includes recording internal controls, testing those controls and identifying weaknesses.
How can we locate reliable UK business suppliers?
We have a network of local lawyers and bankers who we can introduce you to. We are used to working closely with our clients' lawyers and bankers to ensure consistency of service and advice.
We also have a network of local business suppliers who we can recommend. Examples include:
- Travel agents
- Office equipment and furniture suppliers
- Mobile phone leasing
- Vehicle leasing
- Car retailers
- Property agents
- Removal firms
- Advice on local schools
- Availability of grants
- Translators
- Printers
- IT suppliers
- Recruitment agencies