Breakfast Briefing with Alex Altmann LLM (Tax) ACCA The UK as a hub for global expansion 26 May 2016

Agenda 1.The UK as a place to invest 2.The UK as a hub for global expansion 3.Tax implications when investing in the UK 4.Tax implications when selling cross-border 5.Questions and answers

 Traditional firm of Chartered Accountants  Tax, audit and outsourcing services  Based in Covent Garden, London  27 Partners and Directors, over 240 staff  70 th anniversary last year  Focus on international investment in the UK  Over 20 languages spoken in the office  BKR International in over 80 countries About Blick Rothenberg

 Why is the UK a good place to do business? –Large consumer market, e-commerce –The UK is “open” for business, easy to set up a company –The legal and political environment is reliable –Low business taxes –London as the place for an international headquarter  The European Union –Access to the single market –Access to talents –Access to capital –Access to trade agreements The UK as a place to invest

 Why is the UK a good hub to expand a business globally? –UK economy well connected, not only EU but also with the CW –The UK has favourable tax rules for an international business –Very international business environment –Local suppliers offer international services –Don’t underestimate the networking opportunities  Examples –Austrian family business with UK holding structure –UK subsidiary for European operations –UK holding structure for US market entry The UK as a hub for global expansion

 It is easy setting up a company in the UK –A company can be registered in hours –No need to have a physical place of business in the UK –At least one shareholder and one director –Registered office address required  Tax registrations required –Corporation Tax –Employment Tax –VAT and duties Legal and tax implications

 Tax a company pays on corporate profits –Currently 20% and 17% from 2020 –No other taxes on profits but business rates –Depending on the DTA no withholding taxes for profit distribution –Possible to lower tax rate further with tax credits for R&D  Limitations to the “tax heaven” –Need to have a “business going on” in the UK –Management decisions in the UK –No artificial arrangements Corporation Tax

 The company as an employer –Need to register as an employer with the tax authorities –Simple handling of payroll taxes as tax and social security paid together –Employer’s contribution for social security is 13.8% on everything –Strict tax regime and benefits granted to employees  Employee taxes –Employee pay income tax which is paid through the payroll –Tax rates are 0% (up to 11k), 20% (up to 32k), 40% (up to 150k), 45% –National insurance is 0% (up to 8k), 12% (up to 43k), 2% –Possibilities to claim tax reliefs for expats Employment Taxes

 Value Added Tax –Charged by a business on goods and services –Standard rate is 20%, lower rates are 5% and 0% –VAT should be charged where goods and services are consumed –Complex system of EU rules where VAT should be charged –Consignment stocks and fixed establishments for services  Duty rates –European Union is a customs union –When goods enter the EU the same duty rates apply (protection) –Customs warehouses VAT and duty rates

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