UK Company Formation...

Everything you need to know about setting up in the UK.

UK Company Formation Wizard

Use our helpful tool to see what's required to set up your company in the UK.

Setting Up in The UK

A practical guide to what’s involved, and what you can expect to happen during this process.

FAQs

Get answers to commonly asked questions about company formation, accounting and taxes.

Our Services...

From accounting to personalised telephone answering – everything your company needs to thrive in the UK.

UK Company Formation

Company formation, memorandum and articles registration and appointing Directors and Shareholders.

Legal Compliance

Covering various business operations such as company secretary, registered office, handling post and more.

Outsourced Finance Office

Complete administrative support for your UK company designed especially for foreign businesses.

Bank Account Opening

Operate from day one with an EBS Client Account that can be opened immediately.

Virtual Office Service

UK business address, personalised phone answering service, mail handling, access to the meeting room.

NEW

Hot Desking Service

Co-working space and hot desking services offering a flexible and collaborative working environment.

Advisory Services

Advice on formation, directorship and other relevant rules and regulations related to setting up in the UK.

Brokerage Services

A single entry point to services frequently required in the early stages of company development.

About EBS...

Find out more about EBS, how we operate and what we stand for – or simply get in touch with us.

Who we are and how we work

We work exclusively with foreign-owned businesses in the UK and understand the problems they face.

Our Team

Behind every successful business is a great team - meet the team that makes up EBS.

Contact Details

Our address and contact details. If you need to get in touch with us, you can email us here.

Who we work with...

Explore our case studies and see how we work with foreign companies, helping them set up in the UK.

What's happening in the Industry

We’ve created and curated some helpful news articles relating to EBS and the industry in general.

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Helpful Guides and Documents

We’ve created some helpful guides and documents covering topics such as Britain’s History and Geography, The Legal System, Formalities and more. 

Join our mailing list

Sign up to our mailing list to get guidance articles straight to your inbox.

Get in touch with us...

We’d love to hear from you! – if you have any questions, please get in touch with us on phone, email or social media, and our friendly team will be pleased to help.

Head Office

EBS Ltd, Innovation Centre, Gallows Hill, Warwick, CV34 6UW

London Office

EBS Ltd, 118 Pall Mall, London, SW1Y 5EA

Manchester Office

EBS Ltd, Elliot House, 151 Deansgate, Manchester, M3 3WD

witholding tax scaled

Brexit and changes to withholding taxes

The EU parent-subsidiary directive removes withholding taxes on any payments of dividends or profit distributions between associated companies within different EU member states. Companies are defined as associated where one holds 10% of the capital of the other for a minimum period of two years.

Similarly, the EU interest and royalties directive removes withholding taxes from payments of interest and royalties between associated companies. The definition of “associated” is different for interest and royalty payments and the required shareholding is 25%.

The directives have continued to apply to the UK during the Brexit transition period but came to an end on 31 December. The impact is that some payments between UK and EU resident associated companies will be subject to withholding taxes.

The table below shows the rates applicable to certain payments, based on the domestic legislation of the territories concerned and the relevant double tax agreements with the UK at the time of writing (see a full list of agreements). We would advise clients to always check the current treaty in case of any subsequent changes.

Notes: 
* Lower rate applies to copyright royalties.
** Lower rate applies to interest on sales of or royalties for the use of industrial, commercial or scientific equipment.
*** Witholding tax only applies to patents, trademarks, designs or models, plans, secret formulae or processes, or for the use of, or the right to use, any industrial, commercial or scientific equipment, or for information concerning industrial, commercial, technical, technological or scientific experience.
**** 0% where the conditions of the Luxembourg participation exemption are met.

It is possible that the UK will be able to renegotiate some existing double taxation treaties so that they replicate the current position. Alternatively, some EU countries may amend their domestic tax rules to achieve the same outcome. In the meantime, many companies may need to take action to manage their cashflow position.

If they wish to take advantage of treaty rates of withholding tax (which in some cases exempt the relevant payment from withholding tax altogether), some UK companies will need to make new or amended withholding tax applications. The relevant forms usually need to be submitted by the UK companies concerned to the taxing authority of the paying company to enable the payer to make payments of dividends, interest or royalties at the applicable treaty rate. The forms are usually completed and stamped by the EU tax authority concerned to provide evidence that the company is entitled to the treaty benefits concerned.

The UK does not normally charge company profits tax on dividends received from other companies in the same group. However in the case of dividends paid to the UK from some EU countries (Portugal is an example), the EU country will only allow the double tax treaty rate to apply where the dividends are subject to tax in the UK. It will therefore need to be considered if it is better to elect to tax the dividend in the UK to secure the treaty rate of withholding tax.

EU resident companies may also wish to take similar action in relation to payments from UK resident associated companies. However, it is worth noting that:

-the UK does not withhold tax on dividends made by UK companies; and
-royalty payments can be made gross or at the treaty rate of withholding as applicable by UK companies where the payer reasonably believes that the receipt is entitled to the benefits under the relevant treaty.

Source: Institute of Chartered Accountants in England and Wales

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Warwick Office

EBS Ltd, Innovation Centre, Gallows Hill, Warwick, CV34 6UW

London Office

EBS Ltd, 71-75 Shelton Street, Covent Garden, London, WC2H 9JQ

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