Home » Culture » The Non Resident’s Guide to Setting Up in the US: 3 Key Things to Consider
The Non Resident’s Guide to Setting Up in the US: 3 Key Things to Consider
by Startacus Admin
Setting up business in the US is more appealing than ever. Brexit is casting a sizeable shadow of doubt over our future business relationship with Europe, so it makes sense to at least consider expanding stateside. However, if you’re thinking of setting up across the pond rather than across the channel, there’s a lot you’re going to need to research first. To get you started, here are three things to consider:
‘C’ corporations are taxed separately from their owners, and the dividends are taxed again once they have been distributed to shareholders. As you might imagine, ‘C’ corporations involve complex tax and legal practices, so might cost you more. On the other hand, ‘S’ corporations are akin to Limited Liability companies, and they’ll let you operate as a partnership while protecting your partners from personality liability or debt.
Then, you’ll need to apply for a Federal Tax Identification Number. This number allows you to open a US bank account, apply for credit and employ staff, so it’s essential that you file the paperwork for it correctly. You can make choosing your company structure and applying for your Federal Tax Identification Number more straightforward by hiring a good lawyer (or team of lawyers), so long as you’re prepared to pay for the professional help.
2. You’ll need to have a good understanding of US tax rules (or employ someone who does)
Second, tax rules and regulations are a little different to the ones you’re currently adhering to in the UK. In the US, you’ll pay tax at three different levels: federal, local and state. And, to make mattes more complicated, each US state dictates its own level of tax, and you might have to pay an additional rate of tax on top. For instance, you’ll pay an additional tax if you establish a subsidiary in New York (whereas you’ll get a cheaper tax deal in California, for example).
So, be prepared to employ someone to handle all this taxation for you, and be sure your business’s annual budget has factored in these extra taxes. Think about tax carefully when you’re deciding which state to establish a subsidiary in.
3. You’re going to need to hire employees (and that might not be particularly straightforward)
Finally, very few overseas businesses can run without employees working in the country. You’ll have to invest time and resources into identifying local talent, interviewing and hiring employees, as well employing someone to manage them too.
However, you can make this aspect of moving your business overseas a little bit easier (and help with the two factors above) by enlisting the help of a company that helps to handle taxes and logistics such as recruitment on your behalf.
Apparently, a healthy working environment can result in happy & productive workers. With this in mind, Novell Coffee, share their top tips for creating an office space that is both cost-effective & encourages creativity.