The principal reason that British & Irish companies are popular in Europe is down to a number of reasons; but in particular their popularity is due to the fact that Irish & British corporate taxes are low whilst limited companies do not need to be capitalized as is required by law in all civil law countries from Portugal in the South to Sweden in the Far North. This, plus the fact that UK companies can be formed electronically in hours (In Ireland the incorporation process takes 5-10 days but can be executed online) and further that European Union (ECU) Directives/Regulations prevent discrimination against any ECU company operating within another ECU country make UK and Irish companies very attractive. Benefits
The UK & Ireland have very low corporate taxes (As little as 12.5% & 19% respectively)
British & Irish Limited Companies do not need to be capitalized before starting to trade
Legal and Incorporation Fees are a fraction of those in most civil law countries
The legal documents (known as the Memorandum & Articles of Association) can be pre-apostilled under the Hague Convention and pre-translated into most main European languages
Although trading will normally take place exclusively through the local branch / succursale / zweignniederlassung the governing law is that of either the UK or Ireland which is generally considered to be more corporate friendly than that in civil law countries
The overall cost is generally many €1,000s less than if a German gessellschaft mit beschränkter (GmbH) or French société à responsabilité limitée (Sàrl) were formed and capitalized
Understanding Why and How British & Irish Branches Work
All British & Irish limited companies are deemed tax resident in The UK or Ireland or unless covered by a Double Taxation Treaty (DTT) - It is a common misconception that UK companies trading outside the UK do not need to adhere to UK domestic company laws. This is not true, ALL British & Irish companies need to maintain Irish or British accounts, make submissions to the Inland Revenue/Revenue Commissioners and reply to standard statutory enquiries from The Companies House/Companies Registration Office. However, if for example the British/Irish limited company has a branch/succursale/zweignniederlassung in Germany then the zweignniederlassung under the DTT will be subject to German taxes but controlled by Irish or British laws. Thus, if the UK company does not trade in Ireland/UK but has an active branch in Germany only German taxes will apply. In this scenario, the following "options" would be required:
The appointment of an accountant plus the maintenance of accounts for the German zweignniederlassung's which must be maintained and submitted to the Inland Revenue at the end of each financial year (The Form is known as a CT600 Form).
The completion and submission of the Annual Return Form 363 (Included in the Full Secretarial Service)
The apostilling and translation of the UK limited company legal documents (known as the Memorandum and Articles of Association) into German for submission to the German authorize registering the zweignniederlassung
