The UK is one of the most natural expansion markets for Australian startups – shared language, compatible legal frameworks and a deep pool of capital and customers. But getting the setup right matters. Get it wrong and you’re unpicking entity structures, tax registrations and employment obligations months down the track, usually at the worst possible time.

This checklist covers the core steps to get your UK presence established properly from the start.

Choose your business structure

For most Australian startups expanding to the UK, a wholly owned subsidiary is the right structure. A subsidiary is a separate legal entity incorporated in the UK, distinct from your Australian parent company.

The practical benefits:

• UK customers and investors generally prefer dealing with a local entity
• Repatriating funds back to Australia is more straightforward
• Australian taxpayers can typically claim a tax offset for UK corporation tax paid under double taxation relief
• You may be able to access UK R&D Tax Credits, grants and investor schemes like SEIS and EIS if eligible

The main watch-out: IP ownership. Before you set up, confirm whether your intellectual property should sit in the Australian or UK entity. Getting this wrong is expensive to fix later – a startup-experienced lawyer can help you think it through before you commit to a structure.

Register with Companies House

Companies House is the UK equivalent of ASIC. Every UK company must register before trading.

You will need:

• A company name
• Director details (a local UK director is not mandatory but can simplify banking and some compliance requirements)
• A registered UK address for official correspondence – there are mail-forwarding services if you don’t have a physical presence yet
• Articles of association (equivalent to an Australian company constitution)

Once registered, there are ongoing annual obligations including confirmation statements and accounts filing. These are straightforward but non-negotiable.

Register with HMRC

HMRC is the UK equivalent of the ATO. You will need to register for:

• Corporation tax – mandatory for all UK companies
• VAT – equivalent to GST but at 20%, triggered once you reach the registration threshold (check the current threshold at gov.uk as it is subject to change)
• PAYE – the UK’s equivalent of PAYG withholding, required if you have employees

Understand UK employment obligations

If you are hiring in the UK, your payroll obligations include:

• Workplace pension (auto-enrolment) – employees are automatically enrolled unless they opt out; contribution rates are set in employment agreements
• National Insurance Contributions (NICs) – the UK equivalent of payroll tax, paid through the payroll system by both employer and employee
• PAYE – all income tax is withheld through payroll

UK employment law has its own nuances around contracts, leave entitlements and termination – it is worth getting local HR or legal advice before your first hire.

Plan for personal tax if you or a co-founder are relocating

If you or a team member are moving to the UK, the personal tax implications can be significant and are worth planning for well in advance.

Key considerations:

• Visa – if staying longer than six months, you will need the right visa category. The Skilled Worker, Global Talent, Innovator Founder and Start-up visas are the most relevant for founders and startup employees.
• Capital gains tax on departure – Australia taxes capital gains on certain assets when you cease to be a resident. If you hold shares in your startup, this can trigger a tax event before you leave. Get advice on the timing and structure before you book the flights.
• Ongoing tax residency – once you are in the UK, you will likely be subject to UK income tax. Understanding your residency position in both countries from day one avoids costly surprises.

Set up banking

UK banking for foreign-incorporated businesses can be slow through traditional banks, which typically require a local address, local director and in-person verification.

Online banking platforms are usually the faster starting point. Airwallex and Wise both support multi-currency accounts, local UK account details for receiving payments, and company and employee card issuance – all manageable remotely.

Once you have a physical UK presence, opening a traditional bank account as a backup is worth doing. Some UK capital raising requirements and supplier relationships still expect one.

Consider transfer pricing

If your Australian parent company and UK subsidiary are transacting with each other – sharing services, IP licensing, intercompany loans – transfer pricing rules apply in both jurisdictions. These rules require that intercompany transactions are priced at arm’s length, and both the ATO and HMRC take them seriously.

This is an area where getting the documentation right from the start is far easier than reconstructing it later. If your two entities will have any financial relationship, raise it with your tax adviser before transactions begin.

Setting up in the UK and want experienced hands on the detail? We help Australian startups navigate the full UK expansion process – from entity setup and tax registrations through to ongoing bookkeeping, payroll, Companies House compliance and fractional CFO support. See our UK expansion services.