Incorporate me.

Someone got me thinking, which is worth haggling over for having a company entity. Alot of places to incorporate and insert your talent to, but here is the thing that it grinds down too.

United Kingdom

Incorporating a Company in the United Kingdom is easy. You have to decide which Country you wish to incorporate the flag under. There are 3 entity states you can flag it under, England and Wales , Scotland and Ulster (Northern Ireland)

It’s common that companies are registered under the England and Wales flag. They can do business just as where they seem to like it to be. They are denoted by XYZ Company Ltd/Limited or CYR for Private Limited or PLC or CCC for Public Limited Company. The former abbeviation are in WELSH/Cymru. The company needs a company secretary and a director and must be registered to a PHYSICAL ADDRESS and not a postbox. Royal Mail postcodes can easily show that.Companies House, which records the companies are located in CARDIFF,WALES. An Annual Return is required every year without fail.

If your core business is in Scotland, you will need to register the business in SCOTLAND. Scottish companies are denoted by their SC on their registration number. An example will be SC12345678. Normally it also being denoted with XYZ Company (Scotland) Limited. I’m not absolutely sure if GAELIC is allowed in these times.It’s like “BANK OF SCOTLAND” being written as “BANCA ALBA” or something like that. Companies House for Scotland is in Edinburgh. The initial address must be in Scotland.

For Northern Ireland, same thing as Scottish Companies.

These Companies can operate their business in ANYWHERE of the United Kingdom but limited to the Channel Islands of Manx,Jersey,Aldersey and Guernsey. They cannot also place the name as XYZ & Company Inc unlike the US.

If they start employing people or other than the director, they are not just required to register with the HM Revenue and Customs for Corporation Tax but also PAYE or Pay as you earn, collecting National Insurance, Employment Tax,Pensions and Student Loans from the employee. Corporation tax is about 28% as of press (subject to the Chancellor Gordon Brown),whereas Employer’s Contribution for National Insurance (NIC) is 12% and 11% from the employee.

Employment Tax is in the bands of 10%,22% and 40% for income of under £2,000,£29,000 and exceed £29000 with allowances in the Tax Codes (Normally as of now is £5054) otherwise, a tax code of BR meaning Basic Rate of Income Tax at 22% and for non-resident worker or non-identifiable employees, X-Rated or Emergency Tax code of 40% imposed on their earnings. Refunds are made thru End of Year Tax Assessments.

If the Company turnover exceed £52,000 , then they are also required to collect sales tax or Value Added Tax *(VAT) on all sales except those listed. Utilities are rated at 5% and nil for medicines and food (excludes cooked food or takeaways). Fuel is 17.5% added tax on top of all tax imposed.

Setting a company for NON-RESIDENT is about £350, and setting up others, like mail redirection of about £100 plus Royal Mail fees of £62.80 per name, and PAYE and VAT costing much more as you require the person being a legal resident , who is held liable if anything cocks up! That can cost as much as £3000 plus getting you the work permits etc, about £5000!

You must be there to open a UK Company Bank Account.

There are alot of Tax Credits to boost your business. Ask the local Jobcenter and Council for more information. All they want is to help people get to work, thus getting you a better business, locally and globally.

United States

There are many states to choose from. Prices start from $400 onwards plus local fees. Mail redirection and alike cost about another $700 a year plus approx $25 per week in postage for redirecting your company mail. Note that alot of places and businesses like banks etc. Banks and services will still require a PHYSICAL HOME ADDRESS and A PHYSICAL PHONE NUMBER, and that is a hinderance, even when I was there.

Total cost: $5000+ other fees each year which works to about $900.

Don’t be fooled by cheap fees of Delaware and some states. Hidden agenda fees applies. US Banking has the highest service fees, plus checkbooks which they will only ship to the physical address on file.

A Toll-Free Number is best to make business in the US, so that customers think you are somebody especially if the number can spell your business name, like 1800-company etc.

US TAX REGIMES are what I dread most. Even having Quickbooks etc, still makes you stumble here and there. So consider that in your books.

Consider these before you start your affiliate program, as you will need either one for your checks. US Dollar checks can be deposited into the Pounds Sterling Bank Account, but not sterling into Dollar’s. They don’t like the English.

UK Cheques takes about a week to clear, at least, and even with a cheque guarantee card, it can still bounce! Card Processing fees are highest, so might as well use PAYPAL or NOCHEX.