Expanding into the UK: Subsidiary or Permanent Establishment?
Which structure is right for your UK business operations?
When your overseas company begins trading in the UK, one of the first strategic decisions is how to structure your presence:
- Should you set up a UK subsidiary, or
- Trade through a UK permanent establishment (often referred to as a branch)?
At Türner & Co, we help international businesses weigh up these options and choose the approach that best supports their commercial goals, compliance requirements, and group structure.
Understanding the Basics
A UK Subsidiary is a separate legal entity, fully incorporated in the UK but owned by the overseas parent. This setup offers clear legal separation and is often preferred for long-term UK operations. It’s typically easier for things like banking, hiring, and commercial contracts.
A UK Permanent Establishment (PE) is not a separate entity but an extension of your overseas company. It may arise automatically if you start doing business in the UK through a fixed place of work, a UK-based agent, or a long-term project. It’s often used where the UK presence is temporary or project-based.
Which Option Is Right for You?
At Türner & Co, we offer end-to-end support to overseas businesses entering the UK market:
| Subsidiary | Permanent Establishment (PE) |
|---|---|
| Legally separate from the parent | Part of the overseas parent |
| Easier for banking, leasing, contracts | Can be more complex operationally |
| Subject to UK tax on UK profits | Subject to UK tax only on UK-attributable profits |
| May be preferred for long-term UK operations or visa sponsorship needs | May suit short-term or project-specific activity |
We’ll help you understand:
- What triggers a UK PE
- Whether you need a Companies House branch registration
- The tax and administrative impact of each option
- How to manage reporting and exit strategies
Practical Advice from Specialists
Our team works exclusively with international businesses entering the UK. Whether you’re setting up your first UK operation, planning a temporary project, or seeking visa sponsorship options, we’ll help you make the right decision from day one.
Caroline Peverett
Director
Head of Accounting & Audit
Sarah English
Senior Manager
Head of Direct Taxes