https://www.pwc.co.uk/facilitating-global-growth/pathfinder-service.html Doing business and investing in Click to launch the UK March 2021 Edition Contents Chairman’s welcome 1 A profile of the UK, by the Department for International Trade 2 About PwC 4 About this guide 5 Perspectives on the UK as an investment opportunity 6 The tax landscape 7 How does the UK compare with other economies around the world on how easy it is to do business? 8 Foreign direct investment patterns, by the editor-in-chief of Investment Monitor 9 Economic prospects 11 UK economic prospects post COVID-19 in the backdrop of a greener global economy 12 Understanding Brexit 14 The UK regions 17 PwC perspective on international trade and reflection on the regions 18 UK regional overviews 19 The Department for International Trade 27 The UK as a business hub 30 Family businesses in the UK 35 Pathfinder 38 Common questions to consider 40 1.What type of legal presence do I require? 41 2. How do I establish the entity? 45 3. What tax issues do I need to consider? 48 4. How do I deal with my employees? 78 5. What regulatory matters do I need to consider? 86 :KDWRWKHUIDFWRUVLPSDFWP\ŁGRLQJbEXVLQHVVLQWKH8.ł" 7. How do I close a UK business? 117 8. How do I acquire a business in the UK? 122 9. How do I list on a UK stock exchange? 128 $SSHQGLFHV 146 Appendix A – Pathfinder 147 $SSHQGL[%ŋ&KHFNOLVWIRUSXUFKDVHRIDŁQHZłSULYDWHOLPLWHGFRPSDQ\ Appendix C – UK grant incentives 152 Appendix D – UK tax datacard 155 Chairman’s welcome Welcome to the 2021 edition of our guide, Doing business and investing in the UK. How the world has changed since our last edition. Building fairer, greener and more resilient economies has never been more important and depends on the right business and investment. The UK has every incentive and opportunity to build on its position as a vibrant and trusted place for business as we move forward into a post EU trading environment. 2XUbVNLOOHGZRUNIRUFHGLYHUVHHFRQRP\VFLHQFHDQGLQQRYDWLRQKXEVDQGUHQRZQHG OHJDODQGHGXFDWLRQV\VWHPDUHMXVWVRPHRIWKH8.łVFUHGHQWLDOV The relative ease of doing business is also key. This guide provides insight into all the main aspects, from establishing an entity to dealing with employees. With 22,000 people across every pocket of the UK, we have practical experience of the business and legal issues across all industries. We know the culture, we know the market, and have long been helping companies and individuals establish themselves here. I see first hand what a fantastic place the UK is to nurture enterprise and talent. We hope this guide is a helpful starting point to doing business and investing here. If you have any questions or comments, please do not hesitate to get in touch. Kevin Ellis Chairman and Senior Partner PwC UK PwC | Doing business and investing in the UK | 1 A profile of the UK, by the Department for International Trade These are far from normal times. The Coronavirus pandemic Our newly launched Office for Investment sits at the heart of continues to impact people, the economy, business and just Government and demonstrates our strong commitment to about every aspect of our lives in an unprecedented manner. business and inward investment. Under the sponsorship of the While there is light at the end of the tunnel as vaccines Prime Minister and Chancellor the Office will bring together continue to be rolled-out across the UK, the economic impact business expertise from across Whitehall and beyond, will be felt globally for months and years to come. breaking down barriers so that existing and potential investors alike benefit from structured support when they need it. The That is why, at this critical time, trade and investment will be FUHDWLRQRIWKH2IILFHGHPRQVWUDWHVWKH8.łVFRPPLWPHQWWR more important than ever, indeed they are two of the best be the best place in the world for international investors. It is a enablers we have to kickstart growth, get businesses back on core part of communicating our national story on investment their feet and build back our economy greener and stronger and a focus for business facing engagement. than ever. That is why this government is so committed to supporting our businesses to export globally, and making DIT also delivers campaigns that range from helping overseas investing in the United Kingdom even easier, more secure and companies with the logistical elements of locating and growing more profitable for businesses around the globe, as we work to in the UK, inspiring and supporting more UK companies to remove unnecessary obstacles from their paths. take their first steps towards selling overseas, and helping to match foreign companies with innovative, high-quality As an open, dynamic, services-based economy, inward products and services provided by British companies. With our LQYHVWPHQWSOD\VDYLWDOUROHLQWKH8.łVUHFRYHU\IURPWKLV GREAT campaign, we are showing partners worldwide that crisis and is crucial to job creation. In fact, across the UK, %ULWDLQLVŁUHDG\WRWUDGHł bPLOOLRQSHRSOHDUHHPSOR\HGE\IRUHLJQFRPSDQLHVZLWK Department for International Trade (DIT) analysis showing that This pandemic has amplified calls worldwide for sustainable 56,117 new jobs were created in 2019/20 as a result of UK growth – and we are committed to turning the UK into a global )RUHLJQ'LUHFW,QYHVWPHQW )', SURMHFWV7KDWłVZK\DWWUDFWLQJ leader in this field with international investors absolutely critical greater investment will play an even more pivotal role in driving to helping us achieve this goal. Our ten-point plan for a green growth across our economy in the years ahead. industrial revolution in Britain, as laid out by the Prime Minister last November, is a clear commitment to deliver on both the The UK rightly has a proud and hard-won reputation as one of 8.łVDPELWLRXVQHW]HURFDUERQWDUJHWDQGJOREDO the most open economies in the world. We remain one of the commitments, as we build back better in the years ahead. top destinations for FDI in Europe and are one of the foremost International investment will be crucial in driving a new green destinations of inward investment in the world. The industrial base with export capacity. Government continues to work hard to ensure the UK retains its leading position in attracting investment and maximising the At this challenging time, Britain remains one of the most open, impact on the economy. business-friendly and welcoming economies for international investors anywhere on the planet, and we want to work ever Indeed, we continue to enhance our approach to investment as more closely with businesses, institutions and other partners ZHORRNWRUDGLFDOO\WUDQVIRUPWKH8.łVLQYHVWPHQWRIIHUDQG worldwide to embrace the huge economic opportunities the business environment complemented by the Office for future has to offer. Investment and Freeports, to level-up the country, drive economic and productivity growth across the UK. DIT is well positioned to support investment that will power current and future growth in key sectors. We continue to promote investment opportunities from across the UK through the High Potential Opportunities programme, target dedicated investment missions through our new Office for Investment, and work globally to attract high value investment from well established and emerging markets. Gerry Grimstone Minister for Investment at Department for International Trade 2 | Doing business and investing in the UK | PwC About PwC At PwC, our purpose is to build trust in society and solve important problems. We’re a global network of firms in 157 countries with more than 223,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us ZKDWbPDWWHUVWR\RXE\YLVLWLQJXVDWZZZSZFFRP © 2021 PricewaterhouseCoopers LLP. All rights reserved. PwC refers to the UK member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. 4 | Doing business and investing in the UK | PwC About this guide How to use this guide Legal differences This guide is designed so that you can go directly to any The UK consists of three distinct jurisdictions: section that is of interest. That said, we hope you will take the opportunity to read the guide in its entirety. • England and Wales • Scotland Whichever way you use it, we hope that you find the guide useful when you choose the UK as the location for your business. • Northern Ireland Each jurisdiction has its own legal system. Although the three We would ask you to let us know if you see any errors/spelling systems broadly adopt the same approach to business, there or other areas we should change as this guide is a continuous developing document. are some important distinctions. Accordingly, if you are planning to set up your business in Scotland or Northern Please also note that historic information has not been Ireland, we would recommend that you take expert advice to provided unless it is relevant. understand the differences. The guide includes information as at 18 March 2021 and Please note that we will for the purposes of this publication: will be updated on a regular basis. • focus on issues to be considered when setting up a The purpose of this guide business in England or Wales; and • view the UK as a single jurisdiction in which the laws of This publication has been prepared for general guidance on England and Wales apply throughout, unless stated matters of interest only, and does not constitute professional otherwise. advice. You should not act upon the information contained