Expansion to the US often becomes a key feature of a UK company’s growth strategy. The US market offers countless opportunities– a new potential customer base, access to talent and sources of capital, and a chance to develop your offering. However, a new country comes with a distinct set of challenges, so it is important to understand the current US business landscape from the outset to increase your chances of success.
We recently hosted a ‘Doing business in the US’ webinar alongside our Moore Global partner firm Citrin Cooperman and SelectUSA, which focused on the key aspects of doing business in the US and key considerations to consider.
We are delighted to share our key takeaway points from the session:
- Consulting with a US tax adviser on how you structure your business and where you operate in the US is vital as this can have significant tax savings. Do not assume your UK business is taxed the same in the US, or vice versa.
- The type of US entity you form can adversely affect your UK tax position, so also ensure you take UK tax advice before making the move.
- The Biden administration is discussing potential tax changes, including possibly increasing the federal corporate rate from 21% to 28% and the highest marginal individual tax rate from 37% to 39.6%. There are also some proposals that would affect international business specifically, such as repealing the deduction for foreign-derived intangible income (FDII).
- Penalties for non-compliance in the US are significant, especially for international tax forms, so it is important to understand what forms are required of you. Even informational tax forms can have penalties starting at $10,000 per delinquency!
- If you are going to work in the US, take advice from your tax adviser before applying for a green card to avoid any potential pitfalls.
- Make the most of the free resources available to you when looking to expand to the US. The SelectUSA Investor Guide issued by US federal government’s SelectUSA programme is your starting point for your business investment in the US.