Setting up a UK company
1. Legal entities
There are two common legal entity types.
A subsidiary company, also known as a UK private limited company, is a separate legal entity from the parent company even though it is wholly owned by the parent company. You’ll be liable for UK corporation tax on your profits but you may be able to take advantage of reduced rates of corporation tax depending on the size of profits globally.
A UK branch of a parent company, also known as a UK branch, is legally the same entity as the parent, meaning that all profits or losses of the UK establishment are incorporated with those of your overseas parent and all debts and liabilities of the UK establishment belong to the overseas parent.
The type of legal entity that you will need to set up will depend upon your commercial aims. Many customers and suppliers prefer dealing with a UK company, so setting up a subsidiary is often the best option.
"London & Partners has helped a huge amount, advising on the structure of our UK company; whether it should be a new company, a branch or a virtual office."
Patricia Bruscato, Marketing and Sales Director, Componenti
2. Intellectual property
Protecting inventions, designs, branding, and goods and services is critical to the success of a business starting up in the UK. You should consider:
- Patents: a monopoly protection of a new invention capable of industrial application
- Trade marks: marks used to differentiate your goods and are capable of registration
- Design rights: protect the appearance of a purely functional product and are capable of registration
- Copyright: protects the form of expression of ideas and, while not capable of registration, is often asserted with the ‘©’ mark
- Know-how: practical information resulting from experience and testing that can be protected as confidential information to maintain its secrecy and therefore is not capable of registration
- Goodwill: goodwill, custom and exclusive right to carry on a business under the business name. Goodwill is not strictly an IP right and is not capable of registration.
Registering your IP rights is an important investment that generates significant practical, commercial and legal benefits.
Intellectual property costs
|Patents||Trade marks||Design rights|
|Application fee for a patent application: £20–£30||Application to register a trade mark: £170– £200 plus £50 for each additional class||Registration of a single design or the first design in any multiple application: £60 and £40 for every additional design in any multiple application.|
|Request for opinion as to validity or infringement: £200||Renewal of trade mark registration: £200 plus £50 for each additional class||Deferring registration and publication of a design: £40 for a single design or the first design in any multiple application and £20 for every additional design in a multiple application.|
|Application for grant of a Supplementary Protection Certificate: £250||Application to record a change of ownership: £50||Requesting publication and registration of deferred designs: £40 per design|
3. Patent Box
Patent Box is a scheme that allows companies to apply a 10% rate of corporation tax to all profits attributable to qualifying patents, whether paid separately as royalties or embedded in the sales price of products. The scheme was set up to incentivise companies to retain and commercialise existing patents and to develop new, innovative patented products.
Many sectors, including electronics, defence, pharmaceuticals, life sciences and manufacturing can benefit from the scheme. The regime also applies to some other IP rights such as plant variety rights, data protection and supplementary protection certificates (SPCs).
4. How London & Partners can help
London & Partners is the Mayor of London’s official business development company. Our expert team offers free advice to potential investors, from start-ups to established companies. We can:
- connect you to legal experts specialising in setting up UK entities
- introduce you to intellectual property specialists who can advise you on how to protect your inventions, designs and ideas
- offer advice on setting up in London
Guide to setting up business
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Content provided by
- Legal entities information provided by Blick Rothenberg LLP.
- Intellectual property information provided by Penningtons Manches LLP.
This information is intended for general guidance only. You should always seek professional advice.