UK Agency Company
UK Agency Company






                                                                             
                                                            

 


Due to uncertainty surrounding Brexit we are not presently recommending a UK Agency Company for EU trading but instead an Irish Agency Company.

UK Agency Company

Method

Tax Structuring  using a UK company as an agent for an International Company.

One of the benefits of a UK Company is that it conveys a degree of respectability to other entities in which it trades. However, as the rate of UK corporation tax is 20%, for non-residents looking to legitimately mitigate chargeable tax, it is possible to incorporate a UK company to act as an 'agent' on behalf of an overseas international company ('Principal').

In its capacity as Agent, the UK Company is authorised to enter into transactions on behalf of its Principal. In essence, therefore, one would run a business through an international company but employ a UK company to act as an agent  in all it's dealings with customers and suppliers. This can prove to be a very attractive structure for international trading and tax planning purposes. The key issues in respect of UK tax is to ensure there is a commercial contract setting out the terms of an agency relationship and a market rate commission (say 5%-10%) for services rendered.

FAQ


Q: Can the UK Agent company trade within the UK (or with other UK entities)?

A: A UK Agent company should not conduct any activity within the UK. Any trade with other UK entities would mean that the whole amount received would be taxable in the UK as it would be UK source income. In cases where UK entities are involved, the international principal should contract directly but not through the agent company.

Q: Can the UK Agent company get a "Certificate of Tax Residency"?
A: A UK Agent company cannot obtain a certificate of tax residency. We can create a suitable UK company with appropriate structuring to deal with this request, however, the agent company certainly cannot.

Q: Should the UK Agent company transfer the profit to the international company bank account immediately after every business transaction or once a year only (say before filing the Annual Return)?
A: The terms of transfer of funds from the agent company to the principal will depend on the agreement entered into. It can be done every month or once a year.

Q: What is the VAT threshold for the UK Ltd company?
A: Once the UK Ltd company turnover exceeds GBP80,000 the company must register for VAT in the UK.