When US companies are looking to set up a new team in the UK, they often send over an employee from the US. This employee is then tasked with building the new UK team and ensuring the company’s ethos and culture are instilled in the new office. What companies often fail to think about is any visa or income tax implications for the relocating employee. Unless the individual is a UK citizen, they will likely need to apply for a visa in order to live and work in the UK.
Another common mistake is thinking a visa will take a few weeks to be granted, when in reality it could take two to three months. Also, you need to apply for the visa when your employee is still in the US as they will likely need to go for an interview at the UK embassy.
There are several different types of visas to apply for and they all have qualifying criteria that must be met, so it’s wise to get advice from an immigration lawyer. Two common visas that are used by US companies setting up in the UK are Sole Representative and Tier 2 Sponsor Licence. A Sole Representative visa can only be used if you do not yet have a trading subsidiary/branch in the UK. The Tier 2 visa requires you to have a trading subsidiary/branch in the UK, with a payroll registration already in place, and an existing UK employee to sponsor the licence.
Alongside the visa you will also need to think about the employee’s income tax and social security requirements, in both the UK and the US. It’s possible, under certain specific conditions, to keep expats outside the scope of UK tax if they are in the UK for less than 183 days. But, in most cases, if they are working in the UK they will be paying tax in the UK.
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Our Foreign Direct Investment team knows how critical it is to get expansion plans right first time. We can provide expert advice to ensure you have the right long-term solution.
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