United Kingdom

The United Kingdom of Great Britain and Northern Ireland is located in North Western Europe, between the Atlantic Ocean and the North Sea, on the territory of British Isles. It includes the island of Great Britain and one-sixth of the island of Ireland, the Isle of Man and Channel Islands.

Capital

London

Official language

English

Currency

British Pound (GBP)

Form of government

Great Britain is a hereditary monarchy. The government is headed by the Prime Minister who is the leader of the majority party. He appoints the Cabinet of Ministers (executive branch). Legislative body is a bicameral parliament. The judicial system is represented by the Supreme Court, Court of Appeals, District Courts.

Economy

The largest sector in the UK economy is the services sector which is mostly represented by banking, finance and insurance. Britain provides on its own 60% of its food needs. Some sectors of the economy are owned by state.

Legal system

Based on common law.

Corporate law

  • Companies Act 2006
  • The Corporation Tax Act 2009
  • The Corporation Tax Act 2010
  • Corporate Governance Code 2010

Types of companies

  • Private Limited Company
  • Public Limited Company 
  • Company Limited by Guarantee
  • Unlimited Company
  • General Partnership
  • Limited Liability Partnership
  • Limited Partnership

Private Limited Company

  • Shareholders' liability is limited to their shares.
  • Details of shareholders, directors and secretary must be submitted annually to the registration authority (Company House), and this information is available to third parties.
  • There are no requirements to the size of the share capital, at least 1 share equivalent to 1 GBP shall be issued.
  • The company may have one director (who may be a shareholder) and one shareholder, and at least one director must be a natural person.
  • The company must have a secretary.
  • Registered office must be located in the UK, a register of shareholders and directors is kept in the office.
  • An annual audit is required (exception - small and medium-sized companies).
  • Annual report and balance sheet are required, are filed to Company House.
  • The company has the right to conduct any activity not prohibited by law, some activities are licensed such as banking, insurance, franchise.
  • There is no annual state fee.

Taxation of companies

Companies pay Corporation at the rate of 20% (in 2011) if the total income does not exceed GBP 300 000. In the range of GBP 300 000 - GBP 1.5 million tax rate is applied according to a progressive sliding scale; in excess of GBP 1.5 million a maximum rate is applicable (26% in 2011, 25% in 2012). The company must register as a payer of VAT (value added tax) if sells goods and services which are subject to this tax provided that its turnover for the previous 12 months exceeded 73 000 GBP or will exceed this amount in the near future.

Agreements on avoidance of double taxation

UK has concluded treaties on avoidance of double taxation with many countries.