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Starting a Business in United Kingdom

United Kingdom

Starting a Business in United Kingdom

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The United Kingdom (UK)

The phrase good things come in small packages, is somewhat of an understatement when you're talking about the United Kingdom (UK). Yes, you can fit the UK, or Britain, into the good old 'US of A' around 31 times. But, the UK's 137,745 square miles are bursting at the seams with economic activity, making it a prime location to start a business.

The UK is seen as a romantic place by many. With its myriad of myths, from swords in stones to philanthropic thieves, and rolling pastures dotted with crumbling castles, it is easy to see how some of the worlds most noted wizards of the written word including Shakespeare, Wordsworth, Tolkien, Austen, Bront, and Dickens found their inspiration. But dont forget, this petite island is a land of contrasts, and also boasts one of the most dynamic, bustling and business-savvy cities in the form of London, and a string of thriving little sister cities including Birmingham, Leeds, Manchester, Liverpool and Edinburgh. London is the world's largest financial centre and home to the London Stock Exchange, the London International Financial Futures and Options Exchange, and the Lloyd's of London insurance market. London is a major centre for international business and commerce and is the leader of the three "command centres" for the global economy (along with New York City and Tokyo). The UK has cemented itself as one of the four largest economies in Europe, alongside France, Germany and Italy, and a major player in the world business stakes, too.

The UK is a constitutional monarchy. The constitution is uncodified and partly unwritten, comprising constitutional conventions, statutory law and common law. The head of state is the monarch, since 1952 Queen Elizabeth II, although this is an essentially ceremonial role.

The UK (or Britain), is comprised of four countries: England, Scotland, Wales, and Northern Ireland. Each country has its own cultural identity and a proud sense of nationalism. Also under UK sovereignty, though not part of the UK itself, are the Crown dependencies of the Channel Islands and the Isle of Man. The Republic of Ireland, as an independent nation, has not been part of the UK since 1949, when it declared itself a republic.

The UK's population is 60,609,153, and its language is English, although Welsh (Cymraeg) and Scottish Gaelic are also spoken in certain parts of the nation.

The UK and England's capital city is London, while Wales' is Cardiff, Scotland's is Edinburgh, and Northern Ireland's is Belfast.

Why start a business in the UK?

The UK is the birthplace of the English language, and its use is the first of many things our two nations have in common, and an obvious reason why American entrepreneurs choose to base a business there.

Although it has at times been a little turbulent, the nations have a shared history, which has led to the strong links in the countries' legal systems, shared cultural values and beliefs, and parallels in the way they conduct themselves on the world stage.

There are already strong economic bonds between the US and the UK, with each being among the other's main trading partners.

As well as being a picturesque place to be based, the UK also serves as a springboard into doing business (and holidays!) in continental Europe. Being just a stone's throw away, it's not unheard of to 'pop' over to France across the channel tunnel for a business meeting and a croissant, and be back home in time for dinner.

As part of its strategy for economic recovery following the 2008 global economic turndown, the UK government is showing new businesses more support than ever before, including waiving some employment taxes for new businesses starting up in targeted regions of the UK, and minimising red tape. With the government in your corner, there is no better time to start a business in the UK.

What sort of opportunities are there in the UK?

The UK's main industries include:

  • Manufacturing
  • Creative industries
  • Film
  • Steel
  • Automotive
  • Finance, banking and business services
  • Touris
  • Transport equipment
  • Oil and gas.

The UK's largest business show, Business Startup, is held in London biannually. With expert speakers, exhibitors showcasing the full range of business services, and opportunities for networking, it is an excellent source of advice and information for people starting a business in the UK or expanding a current business to the UK. Find out more at


Currency in the UK is pound sterling, represented by the symbol £. Banks in Scotland and Northern Island produces its own banknotes which differ in design to the general notes but can be used anywhere in the UK. There has been some talk about the UK moving onto the Euro, however the UK's new coalition government has made it clear in its first budget that this is nowhere close to being on the priority list.

What's the weather like in the UK?

The UK has a reputation, fuelled by members of its own population through many a self-deprecating joke, for having miserable weather. The climate in England is called temperate maritime. This means that it is mild with temperatures not much lower than 32 F in winter and not much higher than 89.6 F in summer. It also means that it is damp and is subject to frequent changes. July and August are normally the warmest months, while January and February tend to be the coldest.

What are other things I should consider?

Companies trading in the UK must comply with a number of legal requirements and complex procedures: breaching the rules can lead to a company being struck off, or its directors prosecuted. As usual when starting a business, research is key. Don't go in underprepared. Remember that as well as there being differences between the UK and US legal systems, laws can also differ between the UKs different countries.

Take good professional advice - it's cheaper in the long run.

On the subject of legal matters, you may want to look into robust security for your business, such as Verisure Business Alarms, CCTV monitoring, and IT security systems. The UK may be smaller and less "turbulent" than the US, but that does not mean theft or security breaches are not a possibility. This can be important because the UK has strong data protection and confidentiality laws (GDPR) where personal data you would collect of customers or clients must have "appropriate security, including protection against unauthorized or unlawful processing" amongst other rules. This is an example where cutting legal corners with your business could cost you heavily in the long term if a breach were to happen.

Because of the strong sense of nationalism the separate countries that make up the UK have, it is advisable to gather a firm grasp of the different cultures, accents and ways of life, to avoid 'putting your foot in it'. There is some rivalry between the countries, and calling a Welshman 'English', or an Englishman, 'Irish' (etc), may cause offence. Also, remember that being British is not the same thing as being English. The two are not interchangeable. An English person is from England, while a British person may be from anywhere within Britain. Also try to understand the differences between the UK and its offshore islands: Guernsey, Jersey and the Isle of Man.

Also, learn to like drinking tea. It's the national pastime/obsession.


There are many tax incentives and other forms of government-funded assistance available to investors entering the UK market, and companies that specialise in offering advice to businesses starting up in the UK about making the best use of the tax incentives and obtaining grants. The availability of some tax incentives and grants depend on which region the new business is based in, so take this into account when youre investigating where to start your business.

Finding and employing staff

As with the US, finding employees can be as simple as posting a job advertisement in a newspaper or online yourself, or hiring a recruitment company to organise this on your behalf.

How many hours are in the working week?

There are usually around 38 hours in the UK's working week. An employee cannot be expected to work (on average) more than 48 hours in a week.

What are employees' holiday entitlements?

Employees in the UK are entitled to a minimum of 5.6 weeks' paid annual leave (28 days for someone working five days a week). Employers can choose whether they include public holidays (called Bank Holidays in the UK) in the entitlement.

Cultural diversity

Britain has become increasingly diverse as it has accommodated large immigrant populations. The mixture of ethnic groups and cultures make it difficult to define British as looking or acting in one particular manner. The fact that the nations favourite dish is now a curry sums up the cultural melting pot that is modern day Britain.

Doing business in the UK

The British are rather formal. Rank is respected and businesspeople prefer to deal with people at their level. If at all possible, include an elder statesman on your team as he/she will present the aura of authority that is necessary to good business relationships in many companies.

The British have an interesting mix of communication styles encompassing both understatement and direct communication. Many older businesspeople or those from the 'upper class' rely heavily upon formal use of established protocol. Most British are masters of understatement and do not use effusive language. If anything, they have a marked tendency to qualify their statements with such as 'perhaps' or 'it could be'. When communicating with people they see as equal to themselves in rank or class, the British are direct, but modest. If communicating with someone they know well, their style may be more informal, although they will still be reserved.

Punctuality is a very British trait. It is especially important in business situations. In most cases, the people you are meeting will be on time. Always call if you will be even 5 minutes later than agreed. If you are kept waiting a few minutes, do not make an issue of it.

Click here to Ask an Expert about Starting a Business in United Kingdom

Organisations that can assist with Starting a Business

  • > Paul Beare Ltd

    Paul Beare Ltd are UK based accountants and legal advisors to overseas companies setting up in the UK. They work with companies either entering, or already operating in the UK.

    More Details Visit Website
  • > GCE Global Solutions

    We are "GCE GLOBAL SOLUTIONS" the global evolution of " GRUPO CONSULTOR EMPRESARIAL " with the acronym "GCE ®", a leader in the area OUTSOURCING IN BUSINESS MANAGEMENT for business administration worldwide, we have established our own international network of partners in each country.

    More Details Visit Website
  • > TopSource Worldwide

    TopSource Worldwide offers a complete range of employer services that allows you to employ and pay people promptly, consistently and compliantly — locally and internationally to suit your business needs. Our systems and processes are designed to work with your technology, and we bring decades of experience and a track record of success to our operations.

    More Details Visit Website
  • > Sovereign Group

    Sovereign offers a range of advisory and support services to assist companies of all sizes to establish successful business operations in foreign markets.

    More Details Visit Website
  • >

    When expanding your business to the UK, don’t forget to protect your brand. We provide Trademark Registration Services in the UK and in the entire European Union.

    More Details Visit Website
  • > Blue Marble Global Payroll

    Simplified Global Payroll Managing payroll in multiple countries is complicated with different systems, deadlines, and languages in each country, lack of reporting, and constantly changing laws and regulations. Trying to manage global payroll via fax and email with excel spreadsheets leads to data security issues, fines, and penalties for non-compliance. Blue Marble has solved global payroll challenges with cloud-based technology, customized aggregated monthly reporting, and a hybrid service model in 150+ countries around the world.

    More Details Visit Website

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