Doing Business in United Kingdom

Published 25 August 2026

In short

Indian businesses can set up a UK private limited company in under 24 hours for about 50 pounds with no minimum capital. Complete identity verification for directors, register with Companies House, obtain a Unique Taxpayer Reference, open a bank account, register for VAT if turnover exceeds 90,000 pounds, and register as an employer before hiring staff.

Key facts

Capital: London
Currency: Pound Sterling (GBP)
Trade with India: Around 43 billion pounds in goods and services in calendar year 2024, made up of about 18 billion pounds of goods and about 25 billion pounds of services (MEA India-UK Bilateral Brief, July 2025). India's exports were about 26 billion pounds and imports about 17 billion pounds.
Indian community: 1.864 million people of Indian origin per the UK Census 2021, about 2.6 percent of the UK population, of whom 369,000 hold Indian passports, as cited in the MEA India-UK Bilateral Brief of July 2025.

The market

The United Kingdom is a mid sized, high income market of about 68 million people that behaves as a gateway into Europe, the Gulf and Africa for services. India UK trade in goods and services stood at around 43 billion pounds in calendar year 2024, split roughly 18 billion pounds of goods and 25 billion pounds of services, according to the MEA bilateral brief of July 2025. Services, not goods, are the bigger half of this relationship, which is unusual and tells you where the opportunity sits.

Why Indian businesses go there

The single biggest change is the Comprehensive Economic and Trade Agreement, signed on 24 July 2025 and in force from 15 July 2026. It gives zero duty access on about 99 percent of Indian tariff lines covering nearly all of the trade value. Duties of up to 70 percent on processed food, 21.5 percent on marine products, 18 percent on engineering goods and auto components, 16 percent on leather and footwear and 12 percent on textiles and clothing have gone. Services commitments cover 137 sub-sectors. Alongside it, the Double Contribution Convention, signed on 10 February 2026, means Indian employees posted to the UK and their employers do not pay National Insurance there for up to five years, which cuts the cost of a posting sharply.

Beyond the treaty, the UK offers English law contracts, a familiar legal system, Companies House incorporation in under 24 hours for about 50 pounds, and no minimum share capital.

The diaspora and business community

The UK Census 2021 recorded an Indian diaspora of 1.864 million, about 2.6 percent of the population, of whom 369,000 hold Indian passports. A Grant Thornton and FICCI study of March 2022 found over 65,000 companies owned by the Indian diaspora. There are 971 Indian companies operating in the UK employing over one lakh people. This is a genuine commercial network, concentrated in London, Leicester, Birmingham and the North West.

Sector strengths

IT and business services, pharmaceuticals and generics, textiles and apparel, gems and jewellery, engineering goods, food and marine products, and financial and professional services through the City. Indian firms have also become significant UK manufacturers and employers.

The honest difficulties

Cost of people is the main one. Salaries, employer National Insurance and workplace pension auto-enrolment make UK staff expensive, and the Skilled Worker route carries a certificate of sponsorship fee, an Immigration Skills Charge and an Immigration Health Surcharge that together can exceed the visa fee itself. Second, from 18 November 2025 Companies House requires identity verification for directors and people with significant control, so you cannot quietly incorporate with a nominee address any more. Third, since Brexit, UK goods do not flow freely into the European Union. If your real target is the EU, the UK is no longer a back door and you may need a separate EU entity, EORI number and customs setup. Fourth, VAT registration at 90,000 pounds turnover brings quarterly digital filing under Making Tax Digital. Fifth, the start-up visa was closed in 2023 and the Innovator Founder route requires endorsement from an approved body against a genuinely demanding innovation test, so it is not a soft landing for a trading business. Finally, opening a UK business bank account for a non-resident director remains slow and several high street banks decline outright.

How to apply

Decide between a UK subsidiary limited company and registering the Indian company as a UK establishment or branch. A private limited company is the usual choice because it limits liability and looks more credible to UK buyers.
Choose a company name and check availability on the Companies House register, avoiding sensitive words that need approval.
Secure a registered office address in the UK that is a real, appropriate address where post can be acknowledged, since Companies House now rejects PO box only addresses.
Complete identity verification for every director and person with significant control. This has been mandatory since 18 November 2025, either directly with Companies House through GOV.UK One Login or through an Authorised Corporate Service Provider.
Incorporate with Companies House by filing the memorandum and articles of association, share capital details, SIC codes and the PSC register. Online incorporation is normally completed within 24 hours.
Register with HM Revenue and Customs for Corporation Tax within three months of starting to trade. HMRC will issue a Unique Taxpayer Reference.
Open a UK business bank account. Allow several weeks and expect enhanced due diligence questions where all directors are non-resident.
Register for VAT with HMRC if taxable turnover exceeds 90,000 pounds in a rolling twelve months, or voluntarily below that, and set up Making Tax Digital compatible accounting software.
If you import or export goods, apply to HMRC for a GB EORI number and appoint a customs agent, and set up your CETA preferential origin documentation so buyers get the zero duty rate.
Register as an employer with HMRC for PAYE before your first payday, and set up a qualifying workplace pension scheme for auto-enrolment.
Take employers' liability insurance, which is compulsory once you have staff, plus public and product liability cover appropriate to your sector.
Apply for a Home Office sponsor licence if you intend to bring Indian staff on the Skilled Worker or Global Business Mobility routes, and budget for the Immigration Skills Charge and Immigration Health Surcharge.
Obtain any sector regulatory approvals, for example UKCA marking for many goods, FSA registration for food businesses, or FCA authorisation for financial services.
Set up transfer pricing documentation and an intercompany agreement between the Indian parent and the UK entity before invoicing begins.

What the trade actually looks like

→ India sells

IT and business servicesServices are the larger half of the relationship at about 25 billion pounds two way in 2024, and CETA opens commitments across 137 services sub-sectors.
Textiles, apparel and clothingUK duties of up to 12 percent were eliminated when CETA entered into force on 15 July 2026.
Gems and jewelleryA long standing line into the UK retail trade, now duty free under CETA.
Engineering goods and auto componentsDuties of up to 18 percent removed under CETA, which materially changes competitiveness against EU suppliers.
Pharmaceuticals and chemicalsDuties of up to 8 percent removed. India is a major supplier of generics to the NHS supply chain.
Processed food and marine productsThe largest tariff cuts in the agreement, up to 70 percent on processed food and 21.5 percent on marine products.

← India buys

Machinery and mechanical appliancesCapital equipment for Indian manufacturing.
Precious stones and metalsRough and polished stones and bullion trade both ways through London.
Scotch whisky and other beveragesIndia agreed a phased reduction of its high spirits duty under CETA, one of the UK's headline asks.
Electrical machinery and instrumentsIncludes medical and scientific instruments.
Financial, insurance and professional servicesThe City remains a major supplier of insurance, reinsurance and legal services to Indian corporates.

Treaties and agreements with India

India UK Comprehensive Economic and Trade Agreement (CETA) Signed 24 July 2025, in force 15 July 2026

The commercial game changer. Zero duty on about 99 percent of Indian tariff lines covering nearly all trade value, including duties of up to 70 percent removed on processed food, 21.5 percent on marine products, 18 percent on engineering and auto components and 12 percent on textiles. Services access covers 137 sub-sectors. Rules of origin apply.

Double Contribution Convention (social security) Signed 10 February 2026, in force 15 July 2026

Indian employees temporarily posted to the UK, and their employers, are exempt from UK National Insurance contributions for up to five years, extended from the previously proposed three. Around 75,000 Indian professionals and over 900 companies were projected to benefit. In cash terms this removes roughly 15 percent of payroll cost on a posting.

Double Taxation Avoidance Convention Signed 25 January 1993, in force 26 October 1993

Prevents double taxation of the same income and caps withholding tax on dividends, interest, royalties and fees for technical services. It also sets the permanent establishment threshold that determines when your UK activity becomes taxable there, which matters for project work and secondments.

India UK Young Professionals Scheme Announced 2021, operating since 2023

A reciprocal ballot giving 3,000 places a year to Indian degree holders aged 18 to 30 for a two year visa to live and work in the UK, without needing an employer sponsor. Small in scale but the only unsponsored work route for young Indian staff, and useful for seeding a UK sales team cheaply.

India UK Joint Economic and Trade Committee (JETCO) Established 13 January 2005

The ministerial channel led by the Indian Commerce Minister and the UK Secretary of State for Business and Trade. It is where market access complaints, standards recognition and regulatory barriers get raised, and it is the route an Indian industry body uses to escalate a specific UK non-tariff problem.

Which company type to use

Private company limited by shares (Ltd)	The standard vehicle. No minimum share capital, one director and one shareholder is enough, and directors need not be UK resident. Accounts and a confirmation statement must be filed annually.
UK establishment (branch) of the Indian company	Registered at Companies House under the overseas company rules. Cheaper to run but the Indian parent's accounts become publicly filed in the UK and the parent carries the liability.
Limited Liability Partnership (LLP)	Tax transparent, so profits are taxed on the members. Common for professional services firms. Needs at least two designated members.
Public limited company (PLC)	Required for a public offering or listing, with a minimum issued share capital of 50,000 pounds of which 25 percent must be paid up. Rarely the right first step.
Sole trader or ordinary partnership	No separate legal personality and unlimited personal liability. Not appropriate for an inbound business, and you would still need immigration permission to work.

Visas and tax

Getting yourself there

There is no general business visa. Founders use the Innovator Founder visa, which needs endorsement from an approved body, or the Global Business Mobility UK Expansion Worker route where an overseas business is opening a UK branch or subsidiary. Staff move on the Skilled Worker visa or the Senior or Specialist Worker route, both needing a Home Office sponsor licence. The Young Professionals Scheme gives Indians aged 18 to 30 three thousand unsponsored two year visas annually.

What you will pay

Corporation tax is charged at a main rate of 25 percent on profits above 250,000 pounds and a small profits rate of 19 percent below 50,000 pounds, with marginal relief tapering between the two, for the financial year beginning 1 April 2026. VAT is 20 percent standard with a 90,000 pound registration threshold. A Double Taxation Avoidance Convention with India exists, signed on 25 January 1993 and in force from 26 October 1993. The Double Contribution Convention on social security has been in force since 15 July 2026.

Indian government support for this market

Federation of Indian Export Organisations (FIEO)

The apex export body under the Department of Commerce. It issues Registration cum Membership Certificates, runs UK buyer seller meets and delegations, and has been the main channel for briefing exporters on how to claim preferential origin under CETA. Its regional offices help MSMEs with documentation and buyer verification.

Apparel Export Promotion Council (AEPC)

The Department of Commerce sponsored council for garments, one of the biggest gainers from CETA where UK duties of up to 12 percent were removed. AEPC runs UK buyer programmes, helps members meet UK retailer compliance and social audit requirements, and issues guidance on rules of origin for made-ups and apparel.

Marine Products Export Development Authority (MPEDA)

A statutory body under the Department of Commerce. Marine products saw UK duties of up to 21.5 percent removed under CETA. MPEDA handles exporter registration, pre-processing and processing plant approvals, residue monitoring under the NRCP and the certification UK and EU buyers demand, plus subsidy schemes for cold chain upgrades.

Trade Connect ePlatform, Directorate General of Foreign Trade

The Department of Commerce single window launched on 11 September 2024. It links Importer Exporter Code holders with the Indian High Commission in London, export promotion councils and trade experts, and carries an FTA benefit lookup so you can check whether your HS code qualifies for CETA zero duty before quoting.

Frequently asked questions

What is the CETA agreement and how does it help Indian businesses in UK?

The Comprehensive Economic and Trade Agreement came into force on 15 July 2026, eliminating duties on 99 percent of Indian tariff lines. It removes duties up to 70 percent on processed food, 21.5 percent on marine products and 18 percent on engineering goods, covering nearly all India-UK trade value.

Can I register a UK company as an Indian business owner?

Yes. Incorporate a private limited company with Companies House in under 24 hours for about 50 pounds. Since 18 November 2025, you must complete identity verification for every director through GOV.UK One Login or an Authorised Corporate Service Provider.

How much does it cost to set up a UK company?

Companies House incorporation costs about 50 pounds and is completed within 24 hours. You need a UK registered office address, identity verification for directors, and later costs include business bank account opening, tax registration, employer registration and insurance.

What are the main challenges for Indian businesses setting up in UK?

UK staff salaries are high. Skilled Worker visas require sponsorship fees and Immigration Health Surcharge. Since 18 November 2025, directors cannot use nominee addresses. VAT registration at 90,000 pounds turnover requires quarterly digital filing. Business bank accounts open slowly for non-residents.

Do I need to register for VAT in the UK?

You must register for VAT if taxable turnover exceeds 90,000 pounds in a rolling twelve months. You can register voluntarily below that threshold. Once registered, you must file quarterly with HMRC under Making Tax Digital using compatible accounting software.

What visa routes are available for Indian employees in UK?

Use the Skilled Worker or Global Business Mobility routes. You need a Home Office sponsor licence, a Certificate of Sponsorship, and must pay the Immigration Skills Charge and Immigration Health Surcharge. The Double Contribution Convention from 10 February 2026 exempts Indian employees from UK National Insurance for up to five years.

Before you apply: confirm every date, fee and eligibility rule on the official website linked on this page. Public and Policy is an independent portal, not a government body, and details change without notice.