Setting Up a UK Branch: Immigration Steps Aligned to Company Formation and Banking Essentials

Setting up a branch in the UK involves several important steps connected to immigration, company formation, and banking. To legally operate, you must register your branch with Companies House, secure the right visas for key staff, and set up a UK bank account to manage your business finances. These steps are closely linked and need careful planning to avoid delays.

Your business may need a UK Expansion Worker visa if you’re sending employees to establish the branch. At the same time, registering your branch officially creates a legal presence, allowing you to open a bank account and comply with local tax rules. Understanding how these parts fit together will help you expand smoothly and meet all legal requirements.

Overview of Setting Up a UK Branch

When setting up a UK branch, you must understand the difference between a permanent establishment and a subsidiary. You will need to follow clear legal steps for registration and understand the key legal requirements for your business to operate in the UK.

Permanent Establishment Versus Subsidiary in the UK

A permanent establishment (PE) is essentially an extension of your foreign company in the UK. It is not a separate legal entity but an office, branch, or place where you conduct business. The PE is registered with Companies House and HMRC. Your foreign company remains fully liable for all branch operations.

A subsidiary is a separate UK company owned by your foreign parent. It offers limited liability and greater legal protection but requires full company incorporation and separate tax filings. Subsidiaries also need local directors and separate banking arrangements.

Choosing between a PE and subsidiary depends on liability preferences, tax implications, and the scale of your UK operations.

Key Steps and Sequence of Actions

First, register the branch with Companies House. You must provide details about your foreign parent company and the branch’s UK address.

Next, register for tax purposes with HM Revenue & Customs (HMRC), including VAT if applicable. You may need to set up payroll if hiring staff.

Open a UK bank account to manage business transactions. Banks usually require your company documents, proof of UK presence, and identification for authorised signatories.

Finally, comply with ongoing reporting requirements. File annual confirmation statements and accounts for the branch.

Initial Legal Considerations for Expansion

When expanding, you must follow the UK Companies Act 2006 for registration and governance. You will also need to check visa requirements, especially if relocating staff. The UK Expansion Worker visa can allow you to send employees to the UK to start the branch.

You must understand VAT rules, employment law, and other compliance matters. Registering for VAT depends on your turnover and activity.

Contracts and local regulations should be reviewed to avoid conflicts with UK law. Your legal entity setup impacts tax liabilities and operational risks. Access to local legal advice early on can prevent issues later.

UK Company Formation: Legal and Compliance Requirements

When setting up a UK branch, you must follow several legal steps to register your company and meet ongoing compliance rules. These include registering your business officially, following the Companies Act 2006, and completing regular filings with authorities.

Registering with Companies House

You need to register your UK branch or company with Companies House, the official government body that keeps the register of companies. To do this, you must submit Form IN01 if forming a new company or notify Companies House if setting up a branch of an overseas business.

This process includes choosing a unique company name and providing details such as your registered office address, director information, and company structure. You must also select the Standard Industrial Classification (SIC) code, which describes your business activities.

The registration requires a fee payment and typically takes 24 to 48 hours online. Once registered, your company will receive a certificate of incorporation confirming your legal status in the UK.

Complying with the Companies Act 2006

The Companies Act 2006 sets out your duties and responsibilities as a company. You must ensure your company follows this law to remain compliant.

Key points include appointing at least one director and keeping accurate financial records.

You must also prepare annual accounts and have a registered office address in the UK. Additionally, your company’s memorandum and articles of association must align with the Act, outlining rules on management and decision-making.

You should be aware of duties on company directors, including acting in the company’s best interest, avoiding conflicts, and preventing wrongful trading. Following these duties helps protect you and your company from legal risks.

Meeting Statutory Reporting and Filing Duties

You are required to submit key documents to Companies House every year to comply with statutory reporting duties. These include an annual confirmation statement and annual financial accounts.

The confirmation statement verifies details like directors, shareholders, and registered office remain up-to-date. It must be filed at least once every 12 months.

Annual accounts must be prepared in line with UK accounting standards and submitted, showing your company’s financial position. Depending on the size of your company, the reporting requirements may vary.

Late filing can result in penalties. Staying on top of deadlines ensures you meet legal obligations and maintain your company’s good standing.

Immigration Steps for Overseas Business Expansion

To set up a branch in the UK, you will need to follow specific immigration procedures tied to your company’s formation and the roles of key personnel. This involves selecting the right visa, securing work permits, and meeting sponsorship duties to comply with UK laws.

Business Visa Options and Eligibility

You can apply for the UK Expansion Worker visa if you are a senior manager or specialist sent from your overseas business to establish a new UK branch or subsidiary. This visa is designed for businesses that have not yet started trading in the UK.

Eligibility requires that your company is registered overseas and aims to open a presence in the UK. You must hold a relevant role within the business and meet salary and skill level requirements. Other visa options, like the Sole Representative visa, may be available but have different rules and limits.

Obtaining Required Work Permits and Certificates

Before sending workers to the UK branch, you need the correct work permits under the visa type. The Expansion Worker visa holder will require a Certificate of Sponsorship from your UK entity once it is registered.

This certificate confirms the job role and salary meet UK Home Office standards. It is crucial to submit accurate documentation to avoid delays. Your employees must also prove their identity, criminal record status, and meet health requirements such as tuberculosis tests if applicable.

Sponsorship and Compliance Obligations

After company registration in the UK, you must apply for a Sponsor Licence before hiring or transferring employees under the Expansion Worker visa. This licence shows you can meet immigration rules and properly manage overseas workers.

You are responsible for tracking employees’ work status, reporting changes like absences or contract ends to UK Visas and Immigration, and keeping records. Non-compliance can lead to licence suspension or fines, so you must maintain strict control over your sponsorship duties at all times.

Establishing UK Business Banking Solutions

Setting up strong banking is essential when you open a UK branch. You must follow specific steps to open accounts, meet legal rules, and choose services that suit your business needs, especially if you operate internationally or digitally.

Opening a UK Business Bank Account

To open a business bank account in the UK, you’ll need more than just your company registration. Banks require proof of your UK business address and identification for all key company members, such as directors and shareholders.

You must prepare official documents like your certificate of incorporation, memorandum and articles of association, and sometimes proof of your overseas address. Banks tend to have strict criteria, especially for foreign owners, so it’s important to check which banks accept international clients.

Some banks may also ask for a detailed business plan or source-of-funds explanation. Options are limited, but a few banks specialise in working with foreign companies setting up UK branches.

Meeting Anti-Money Laundering (AML) Rules

Banks are required by law to follow anti-money laundering (AML) regulations. This means you will need to provide clear evidence about where your money comes from and how it will be used.

Expect a thorough identity check on company owners and directors. This includes personal ID like passports and proof of address documents. You may also need to explain your business activities in detail.

AML checks can delay your account opening, so prepare your documents carefully. Following these rules helps prevent fraud, and your cooperation ensures compliance and smooth banking access.

Digital and International Banking Considerations

You should consider banks that offer digital services for easy management of your UK account. Features like online banking, mobile apps, and multi-currency wallets can support your branch’s daily operations.

If your UK branch deals with clients or suppliers overseas, choose banks with strong international capabilities. Look for services including international payments, currency conversion, and global account access.

Some UK banks partner with fintech firms to provide enhanced cross-border banking tools. This can save you time and reduce fees related to foreign transactions. Always compare fees and service accessibility before choosing.

Ongoing Regulatory and Operational Considerations

When you set up a UK branch, you must keep up with tax duties, trading licences, and regular reporting. Staying ahead with compliance ensures smooth business operations and helps you avoid penalties or delays.

HMRC Registration and Taxation

You must register your branch with HM Revenue and Customs (HMRC) soon after starting trading. This registration covers Corporation Tax and VAT if your turnover exceeds the VAT threshold.

You will be responsible for filing annual Corporation Tax returns for your UK branch. Keep detailed records of UK-based income and expenses to meet these obligations.

PAYE and National Insurance Contributions apply if you have employees in the UK. You will need to operate a payroll system and submit real-time information (RTI) to HMRC.

Important: Make sure you understand the double taxation treaties between the UK and your home country to avoid paying tax twice on the same profits.

Import Licences and Sanctions Compliance

If your branch imports goods, you must get the correct licences from UK authorities. Certain products like food, chemicals, or controlled goods require specific permits before they enter the UK.

You also need to comply with UK sanctions laws. Check the current sanctions list regularly to ensure you do not trade with restricted countries or entities.

Failure to meet licensing or sanctions requirements can result in fines, seizure of goods, or criminal charges. Use government resources to stay updated on any changes.

Reporting, Monitoring, and News Updates

Your branch must file annual financial statements with Companies House, showing your UK operations accurately.

You need to keep up with regulatory news. Signing up for alerts from official UK government sites or industry news portals can help you stay informed.

Regular audits or reviews may be necessary depending on your business size or sector. Maintaining transparent records is key to passing inspections.

Use online login portals provided by HMRC and Companies House to manage submissions securely and on time. This eases compliance and avoids late filing penalties.

Looking for trusted legal experts? Athi Law offers experienced business immigration solicitors to support your company’s global talent needs, specialists in commercial conveyancing to protect your property transactions, and reliable independent legal advice for mortgage agreements. We also assist with immigration for parents, helping reunite families with care. Speak to us today!