The United States is the UK’s most important trading partner, accounting for 16.2% of goods shipped in the first quarter of 2020 and 14.7 % in the second quarter. Despite the differences in business approaches between the United Kingdom and the United States, many British entrepreneurs prefer to focus on the United States rather than Europe. In recent years, the United Kingdom (England, Northern Ireland, Scotland, and Wales) traded $410.9 billion worth of goods with its trading partners all over the world.
An increasing number of companies in the United Kingdom are looking to expand in the United States. Entrepreneurs who do this are willing to adapt their businesses to the needs of the American market because there are more prospects for collaboration there than in Europe.
Below we will discuss the various reasons why UK entrepreneurs are interested to start a business in the US:
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Brexit and Europe
After Brexit, the challenges of engaging with the European market have been even more obvious. Because of product origin laws, imports and exports between the EU and the UK have become more problematic. VAT difficulties, increasing import tariffs, and complicated customs clearances are among the other challenges. Since leaving the EU, the United Kingdom has begun directly negotiating trade agreements with the United States. Fortunately, American consumers are willing to acquire things from other countries if the prices are lower.
Customs and Border Protection in the United States is in charge of trading regulations (CBP). For the UK, the minimal threshold for import duty is now $800. Any goods below that threshold are exempt from duty, implying that only enterprises sending extremely high-value commodities in large quantities must pay import tax. For internet shoppers in the United States purchasing goods from UK businesses, this makes trade between the two countries incredibly cost-effective.
Employment And Tax Laws
It may be more cost-effective for a UK company to establish a subsidiary in the United States. This is especially relevant if the UK-based company needs to hire US workers or if the UK corporation generates revenue in the US. This is due to differences in employment regulations and taxation between the United States and the United Kingdom.
In order to be more tax-efficient, UK entities that generate income in the United States normally need to create a structure to distribute cash to a U.S. business. Incorporating a company in the United States also protects it from legal concerns. For information regarding state laws and regulations, one can visit The Really Useful Information Company (TRUiC) website.
Easy Business Incorporation
LLC Incorporation Services ensures that you get the legal structure of your business correct when beginning a business in the United States, whether you are a U.S.-based company or setting up an American branch for your entity. LLC incorporation services ensure that you are aware of all of your options and that you have all of the necessary documents.
ZenBusiness, IncFile, Northwest Registered Agent, and Legal Zoom are some of the most well-known business formation services in the United States. These companies provide far more than simply low-cost incorporation services; they also provide extra packages to assist you in meeting the yearly, report, and compliance filing obligations of the state in which you choose to incorporate.
Both the United Kingdom and the United States make it simple to incorporate a business. This makes it simple for entrepreneurs from the United Kingdom to create a business or a subsidiary of their existing business in the United States. The United Kingdom is widely regarded as Europe’s friendliest country for foreign investors. Documentation execution in the United States is more streamlined than in the United Kingdom, and the country is particularly founder-friendly. One notable difference that contributes to the popularity of the United States is that private enterprises are not required to make their corporate information and financial information publicly available. In the United Kingdom, information regarding the board of directors, shareholders, and finances must be made public.
Brexit and other issues have made the British believe that there is little willingness in Europe to help them market their products. They’ve set their sights on the vast American markets on the other side of the Atlantic, which are world leaders in innovation and entrepreneurship.