UK company vs branch vs subsidiary: which is right for an overseas business?

A UK subsidiary is a separate UK incorporated company, wholly or partly owned by the overseas parent, taxed on its own profits at UK corporation tax rates and filing its own accounts. Liability generally stops at the subsidiary, protecting the parent from UK trading risk.

Registering the overseas company itself as operating a UK establishment avoids creating a second legal entity but means the overseas company is directly liable for UK activities, must file its own accounts translated and adapted for the UK register, and is taxed in the UK only on UK branch profits under the permanent establishment rules.

For a founder without an existing trading company at home, incorporating fresh in the UK is simpler than establishing a branch of a company that does not really trade elsewhere, and it gives a clean UK entity for banking, contracts and customer-facing credibility.

Where there is a genuine existing overseas business, a subsidiary is usually preferred over a branch because it limits liability, gives a clear UK tax position, and avoids having to disclose the parent's full overseas accounts on the UK public register.

Our fixed monthly packages for a UK limited company start at £89 plus VAT and run to £169 and £289 plus VAT as bookkeeping, VAT, payroll and reporting are added. One-off filings are sold at fixed prices, and the Companies House fees we pay for you are charged at cost with no VAT added. Overseas owners are quoted on exactly the same published prices as UK-resident clients.

Rates, thresholds and deadlines here reflect the 2026/27 UK position and current Companies House and HMRC guidance. Check GOV.UK, or ask us, before relying on them for your own company.