The UK is a country with a vibrant economy and diverse culture. If you are looking to do business internationally, the UK is a fantastic choice. In 2021, it was listed as the fifth-largest economy in the world, with a nominal GDP of $3.19 trillion. While the country left the European Union in 2020, its strength in business has remained.
With its business-friendly policy, labor laws, geography, highly skilled workforce, and its straightforward UK tax law, the UK provides a conducive environment for businesses to thrive. This article will explore some of the benefits of doing business in the UK.
Ease of Doing Business
The United Kingdom is widely regarded as a top destination for doing business, thanks in part to its reputation for having straightforward business practices. In fact, in 2019, the World Bank ranked the UK in the top 10 countries with the highest "ease of doing business." This score is based on metrics such as starting a business, paying taxes, cross-border training, and enforcing contracts. There are many reasons why doing business in the UK is simpler than it is in other countries, such as:
- The UK has fewer restrictions for businesses than most developed countries in the world.
- There are more commercial opportunities across different sectors due to the country's strong manufacturing reputation.
- The country has a strong business infrastructure and continues to make improvements in the areas of transportation, energy, and telecommunications.
Flexible Labor Laws
Another UK benefit of doing business is that the country has rather flexible labor laws, especially compared to other European countries like France, the Netherlands, and Germany. Consider the following examples of how UK labor laws have made it easier to do business:
- UK labor laws have resulted in lower labor costs in the UK compared to many other countries in Europe.
- In the UK, you can hire “workers,” “employees,” and “self-employed contractors,” with each being beneficial depending on the situation.
- The UK is famous for having a flexible labor market, making it easier to adjust to changing circumstances.
While UK employment laws are more flexible than they are in many other European countries, there are also some strict worker protections related to overtime work, paid time off, and working on holidays. This is a good thing for employers at the end of the day since it’s clear what needs to be followed, and there are fewer surprises, keeping both you and your employees satisfied.
The UK’s geography can create wider access for your business, given that it is a midway point to the rest of Europe and is a bridge to the rest of the world. Even within the country, there are diverse regions to choose from. Some of the benefits of the UK’s geography are that:
- The UK has access to four different regions, England, Scotland, Wales, and Northern Ireland, each with a dynamic marketplace. The four regions have strong ties to different business sectors, such as manufacturing, technology, tourism, finance, and aerospace, which creates a diversity in business opportunities and can make it easier to pinpoint where to find skilled workers in your sector.
- The UK is located at the crossroads of global trade routes between Europe, North America, and Asia, making it an ideal location for international business.
- The UK has one of the largest air transportation networks in Europe, with its London Heathrow airport being the busiest in Europe.
- It is a majority English-speaking country, making it easier for an international business to learn UK business etiquette and other cultural norms.
Another one of the many UK benefits of doing business in the UK is that you will immediately have access to an educated and skilled workforce. Some reasons that the UK's workforce can serve your business well are that:
- There are more than 30 million workers in the labor market, making it one of the largest pools to find talented workers in Europe.
- The UK workforce is known as reliable and hardworking, helping you to fulfill your business goals.
- The UK has four of the top 10 universities in the world, creating an impressive, highly educated workforce.
- Because the immigration system in the UK is based on a points system and a meritocracy, there are also very skilled foreign employees in the UK, making it a great place to explore other countries’ cultures as well.
- The UK is attracting even more highly skilled workers with its High Potential Individual (HPI) visa, a visa targeted toward graduates from top universities around the world.
Favorable Taxation System
The taxation system in the UK is also much simpler than it is in many other countries. UK tax law makes the country a great place to do business because one of the most difficult parts of creating an international workforce is navigating complicated tax laws. Some of these favorable tax rules in the UK are:
- As of 2022, the UK has a corporation tax rate of 19%, which is the lowest of all the countries in the G20.
- Most companies based in the UK do not pay withholding tax on foreign dividends.
- The UK offers many tax relief and incentive programs to help businesses thrive.
Are you Ready to do Business in the UK?
There are many benefits to doing business in the UK, and Global Expansion can help you with this. Global Expansion's Employer of Record (EOR) services provide numerous offerings for businesses looking to expand globally.
When you partner with us, we will use our expertise and experience to handle your processes in navigating international regulations, managing your business’s human resources, staying in compliance with UK tax law and labor law, and hiring a skilled international team. Our team of experts will provide you with a streamlined approach to help you meet your unique business needs, ensuring a smooth and successful transition into a new country.
So, if you are planning to do business globally and need reliable EOR services, choose Global Expansion.