Registration of a company in Scotland

Scotland is a reputable jurisdiction for running a business with favourable legislation and business opportunities. It has made effective steps for achieving more results in financial sectors. This overview may help you while considering Scotland as your target jurisdiction.

Forms of Legal and Business Presence

If you intend to establish your legal and business presence in Scotland, you may easily do this in the next forms:

• Private Company Limited by Shares – a vehicle where the liability of founders (shareholders) for all undertakings is restricted to the contributed values only. This entity may be especially suitable for small and medium enterprises.
• Public Company Limited by Shares – a vehicle designated to the involvement of capital from the public mostly by offering its shares. The liability of shareholders is restricted in the same manner as for private companies limited by shares. Still, more strict requirements are applied to reporting and disclosure.
• General Partnership – a business formation that possesses a separate legal personality. Its founders (partners) bear unlimited liability for all undertakings, including with their personal property.
• Limited Liability Partnership – a business formation that is established by (i) general partners who bear unlimited responsibility for all undertakings, and (ii) limited partners whose liability is restricted to the extent of their contributions only.
• Branch or representative office – it may be established by any foreign company that intends to test local business opportunities and will be able to cover all related costs.

Registration Requirements and Steps

For a company formation in Scotland, it is required to pass these preliminary steps:

1. Defining your objectives for running a business in Scotland.
2. Collecting information about founders and beneficiary owners.
3. Arranging the registered office for a future vehicle.
4. Drafting statutory documents for a future vehicle.
5. Submitting the set of documents to the Registrar of Companies.
6. Registration for tax and social security purposes.
7. Opening a bank account.

Legal and Regulatory Framework

Scotland has very developed legislation with a special emphasis on compliance and security of a property. The procedure for establishing and running a business here is not burdensome.

The major legal acts regulating the procedure for establishing and running companies are the Companies Act, the Partnership Act, the Limited Partnerships Act.

Advantages of the Jurisdiction

If you think about establishing your business in Scotland, you may potentially enjoy these benefits:

• Reputable jurisdiction open to investments
• Ease in reaching major European markets
• Comparatively simple and fast procedure of the company formation
• Incentives for doing business in R&D, digital communications and technologies.

Tax System

Businessmen who consider registering a company Scotland may be interested in these tax highlights:

• Corporate income tax (CIT) rate – 19%
• Personal income tax (PIT) rate – varies from 19% to 46% depending on the income
• VAT – 20% or 0%
• Capital gains tax rates – (i) corporate – subject to the standard CIT rate (ii) personal – may vary depending on the case.
• Withholding tax rates for non-residents – may vary depending on the type of income and its amount.

How Prifinance Specialists May Help You

If you are in doubts about setting up a company in Scotland or elsewhere, Prifinance specialists may easily resolve these matters. We can consult you more precisely on the specifics of the registration process, prepare and submit all required documents and open a bank account for prospective vehicles. Reach us shortly for more precise discussions.