๐ท๐บ Starting a Business in the UK as an Expat (2026): Structures, Steps & Costs
The UK is one of the easiest and fastest places in the world to start a business โ you can register a limited company online in a day, for a small fee. The bigger questions for expats are the right structure, the tax obligations and, for non-UK citizens, the visa route. This 2026 guide covers it all. Confirm current fees and thresholds on GOV.UK before you rely on them.
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In this guide
Sole Trader or Limited Company?
Your first decision is structure. A sole trader is simplest โ quick to set up, minimal admin, but you’re personally liable for debts. A limited company is a separate legal entity that limits your liability, can be more tax-efficient at higher profits and looks more credible to clients and investors, in exchange for more reporting.
๐ More expat guides for the UK
Living in the UK · Taxes in the UK · Self-Employed in the UK · Driving Licence in the UK · Finding a Job in the UK
Registering a Limited Company
You register (“incorporate”) a company with Companies House online โ often within 24 hours and for a small fee. You’ll choose a company name and directors, issue shares, provide a registered address and set up your company for Corporation Tax with HMRC. Many founders use a formation agent or accountant to get the structure right.
The Steps to Set Up
For a sole trader: register for Self Assessment with HMRC. For a company: incorporate at Companies House, register for Corporation Tax, set up PAYE if you’ll pay yourself or staff a salary, and register for VAT if you exceed (or voluntarily elect) the threshold. Open a business bank account and put bookkeeping in place from day one.
Visa Routes for Founders
Non-UK founders should look at routes such as the Innovator Founder visa (for innovative, scalable businesses endorsed by an approved body) or the Global Talent route for leaders in their field. There’s no simple “buy a business” visa, so the route depends on your venture and background โ take specialist immigration advice early. Those with existing UK status may already be able to trade.
Taxes for Businesses
Companies pay Corporation Tax on profits, and directors typically take a mix of salary (via PAYE) and dividends. You charge and remit VAT once over the registration threshold (around ยฃ90,000). Sole traders pay Income Tax and National Insurance through Self Assessment instead. See our UK tax guide for the personal side.
Business Banking and Getting Paid
A dedicated business account is effectively essential for a limited company and highly recommended for sole traders. If you invoice or buy from abroad, a multi-currency account lets you hold and receive pounds, euros and dollars at the real mid-market rate โ cutting the fees and poor exchange rates that eat into international margins.
Hiring Employees
To employ staff you register as an employer with HMRC, run PAYE payroll, provide a compliant contract and payslips, enrol eligible staff into a workplace pension (auto-enrolment) and carry employers’ liability insurance. Payroll software or an accountant keeps this straightforward.
Frequently Asked Questions
Should I be a sole trader or a limited company in the UK?
Sole trader is simplest for starting out. A limited company limits your liability and can be more tax-efficient at higher profits, with more reporting via Companies House.
How do I register a company in the UK?
Incorporate online with Companies House โ often within 24 hours for a small fee โ then register for Corporation Tax with HMRC. Many use an accountant or formation agent.
Can a non-UK citizen start a business in the UK?
Yes, but you need appropriate immigration status. Routes include the Innovator Founder visa for innovative ventures and Global Talent for leaders in their field.
When do I need to register for VAT?
Once your taxable turnover exceeds the threshold (around ยฃ90,000), or voluntarily below it. Below the threshold, VAT registration is optional.
Your Business Setup Action Plan
The UK makes setup easy โ nail the structure and tax basics. The quick version:
| Step | What to do |
|---|---|
| Choose a structure | Sole trader for simplicity; a limited company for liability and tax efficiency. |
| Sort your visa | Non-UK: explore the Innovator Founder or Global Talent route early. |
| Register properly | Companies House + Corporation Tax, or Self Assessment; add PAYE and VAT as needed. |
| Set up finances | Open business banking and put bookkeeping or an accountant in place. |
Expat Essentials for United Kingdom
A few quick wins make settling into United Kingdom easier while you work through this guide. An Airalo eSIM keeps you online from the moment you land, EKTA bridges your health cover until residency, and NordVPN protects your logins on public wifi. See our full list of trusted services below.
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