There’s a reason why successful businesses get off the ground at all: the people that start them tend to be ambitious, adventurous risk-takers with an entrepreneurial mindset. Sir Richard Branson, Hilary Devey and JK Rowling come to mind as famous examples of when this mindset has worked to devastatingly successful effect in recent years. All three individuals’ companies started with an idea and quickly went global. Indeed, Branson himself has argued that by their very nature, start-ups are international businesses, particularly tech start-ups with developers residing across the globe.
The moral of the story here is that there’s no reason why an ambitious entrepreneur can’t establish their company internationally from the off. After all, the three above examples didn’t become some of the world’s richest people with a ‘play it safe’ mindset.
But what of the important considerations for a start-up seeking to establish cross-border operations early on? The natural first step is to make sure all of your legal necessities are in place, so it makes sense to register with Companies House as a PLC so people across the globe can buy and sell shares in your company. There are also potentially complicated international tax and VAT implications of trading internationally. Registering for VAT, alongside the aforementioned company registration, is an absolute must. Luckily there are several firms out there who specialise in international tax compliance. Organisations such as Accordance VAT can offer advice in this respect and new businesses should visit http://www.accordancevat.com/services/vat-advice/ for more information in regards to that aspect of international business.
Whether you are exporting products overseas or establishing operations in other countries, you will most likely have to register for VAT with the local tax authorities. There are however opportunities presented by tax-efficient travel, accommodation and relocation allowances, meaning that with a bit of prior planning you can move yourself and your employees around the globe for important meetings and to establish operations for less outlay than you’d think.
Much has been spoken of so-called tax havens in the past couple of years and it’s worth noting that even if you register through a holding company based in a low tax region such as The Netherlands, Isle Of Man or Channel Islands, you could still be liable to UK tax rates.
Essentially, expanding overseas is a tricky process but one that can reap significant business benefits. The first step on your road to creating a successful international business is ensuring that all legal considerations are taken care of. Unfortunately a lot of that involves issues such as tax compliance, an element that at the end of the day eats into your bottom line. But don’t be dissuaded from innovating on a global scale. And use the Bransons, Devey’s and Rowling’s of this world as your inspiration.
This post is in association with Accordance VAT