How to Start a Business as an Immigrant in the UK

A beautiful country UK with beautiful sky scrapers and sea surrounded by.

Starting a business in the UK can seem like a very attractive option. However, to achieve this, non-UK entrepreneurs would have to jump through additional legal hoops apart from the already existing registration, licence, employment, and tax regulations that every company must comply with.

UK Business Immigration Requirements for Immigrants

To start a business in the UK as an immigrant, the first step is to obtain suitable immigration status. Not every visa allows foreign nationals to own and operate a business, but only those explicitly devised for that goal or that allow for it.

For example, obtaining a student visa does not give clearance for starting a business. If you are a holder of this or similar visas, you must switch to a qualified visa.

What Type of Visa Should Entrepreneurs Apply for?

Immigrants wishing to start a business in the UK have four business-oriented visa choices at their disposal:

– Innovator Visa

– Start-up Visa

– Global Talent Visa

– UK Sole Representative of a Business Overseas Visa

Note: The Entrepreneur Visa and Investor Visa (tier 1) are no longer issued by the UK Home Office until further notice.

Let’s explain each visa in more detail:

Innovator Visa

The Innovator Visa is a route for experienced foreign entrepreneurs with innovative business ideas recognized by an authorised endorsing body.

To obtain an Innovator Visa, you must have an investment fund of at least £50,000, unless your business was already established and endorsed under a different visa, or you’ve changed to another business with the approval of the endorsing body.

As an Innovator Visa holder, you can remain in the UK for three years, with the possibility of extending the visa for another three years if you meet the eligibility requirements. What’s more, you may obtain Indefinite Leave to Remain (ILR) after three years, opening up the possibility of acquiring British Citizenship.

Start-up Visa

The Start-Up visa is a visa route that’s available to new entrepreneurs looking to start a business but who don’t have the necessary resources for applying for the Innovator Visa described above.

To apply for the Start-Up Visa you must provide evidence that your business idea is new (you can’t join an already established business) and innovative (it must be something different from what the market offers), with growth potential. You must also be endorsed by either a UK higher education institution or an organization known for supporting UK businesspersons.

You’re not required to have an investment fund as is the case with the Innovator Visa, making this the perfect choice for individuals who are short on budget. However, this visa is only valid for two years, can’t be extended and won’t allow you to obtain Indefinite Leave to Remain. If you wish to have access to ILR status, you can consider shifting to an Innovator Visa upon the expiration of the Start-Up Visa.

Global Talent Visa

The global talent visa is a route for foreign talents who are endorsed by approved endorsing bodies in the fields of science, engineering, medicine, humanities, and social sciences. While it’s not specifically a “business visa” it enables you to work, be self-employed or set up your own company. You can apply for this visa without any endorsement if you earn a qualifying award.

The Global Talent Visa permits you to stay in the UK for five years, with the possibility of applying for an extension. You can also apply for Indefinite Leave to Remain after three or five years, depending on the field that you work in.

UK Sole Representative of a Business Overseas Visa

If you are a co-owner or senior employee of a foreign organization looking to set up a branch in the UK, you may apply for this visa. To be considered a “Sole Representative”, you must not be a majority owner or controller of the mother company.

To be deemed eligible for Indefinite Leave to Remain as a Sole Representative of an overseas business, you must spend five continuous years in the UK, provided that you’ve worked full-time for the business’ UK branch/subsidiary.

How to Apply for a UK Business Visa

All visa applications must be submitted online no more than three months prior to your intended travel date (if applying from outside the UK). Likewise, you’d also need to provide the following documentation:

– Valid passport or identity document

– Bank statements and other financial records showing that you have sufficient funds to sustain yourself.

– Proof that you have sufficient knowledge of English (approved English test, degree taught in English issued by an approved institution, etc.) unless you come from a majorly English-speaking country

– A negative tuberculosis test if you’re from a country considered high-risk

Apart from the documents outlined above, you must accompany your petition with the information and documentation that’s proper to the visa type you’re requesting (evidence of investment fund, endorsement letter, evidence of prize or award, etc.)

You will need to prove your identity by either scheduling an appointment at the visa application centre or using the “UK Immigration: ID Check” app.

The decision usually takes three weeks if you apply from outside the UK and eight months if you apply while in the UK.

How Do I Register and Run a Business in the UK As an Immigrant?

Once you’ve obtained your visa and settled in the UK, you may register your business as an immigrant. For that purpose, you must first select a legal structure that most fits your business idea or model. You could register as a:

1. Sole trader, whereby you have entire personal liability (for there is no distinction between you and your venture).

2. Partnership, by which you share liabilities and profits with business partners.

3. Limited company, legally separating yourself from the business.

There are advantages and disadvantages to choosing either one of these structures. Many entrepreneurs prefer to establish limited companies, as that would protect their personal assets. Notwithstanding, managing a limited company involves heavy paperwork and possibly hiring accountants to cope with the added amount of responsibilities.

Sole traders and partners, provided that they exceed the £1,000 tax-free allowance, need to:

– Register with Her Majesty’s Revenue and Customs (HMRC)

– Register for VAT (Value Added Tax) whenever applicable

If you want to start a limited company, you must register with Companies House instead of HMRC.


Sole traders and partners must file a Self-Assessment tax return each January, which should include business earnings and expenses, as well as other personal tax-deductible incomes, for the business in this instance is not a legal entity independent from the owners.

Limited companies, as well as limited liability partnerships, must draft a Company Tax Return. Apart from that, the owners must file their own Self-Assessments, which would have to include the salaries and dividends paid by the company.

If the business’s annual turnover exceeds £85,000, you’d have to also pay the VAT (value added tax) which should be applied to the purchase price of certain products or services (in the event that they’re not exempt).


If you’re planning to establish a small business, you wouldn’t ordinarily require a business licence. Either way, you might want to check’s licence finder to find out whether or not you may need to obtain one.

Some of the most common licences that could be required even by small businesses relate to background music, usage of CCTV (public space surveillance), or alcohol supply, whenever applicable.

Licences for small businesses are granted, in most cases, by individual local authorities. Meanwhile, national authorities may control activities carried out by financial services, professional firms, or nurseries, among others of particular significance to national interests.


When hiring employees, businesses ought to get acquainted with UK employment law, for it is applicable even when evaluating candidates for different roles within the company.

Essential legislation can be found in the following normative instruments (just to name a few):

– Employment Rights Act 1996

– National Minimum Wage Act 1998

– Employment Relations Act 1999

– Equality Act 2010

– Maternity and Parental Leave etc. Regulations 1999

– Part-Time Workers Regulations 2000

UK Employment law is vast and can be intimidating for new businesses. With that said, you must pay very close attention to employees’ statutory rights such as maternity, holiday, and redundancy pay. Anti-discrimination laws and disciplinary regulations must also be taken seriously, as breaching these could cause you serious problems down the road.

Frequently Asked Questions

Would I need a license to hire foreign employees?

In certain cases, you would have to obtain a sponsor licence to hire overseas employees if they come to the UK as:

– A skilled worker

– A seasonal worker

– An international sportsperson

– A charity worker

– A health or care worker

– A worker on government-authorised exchange

– A creative worker

– A worker under a category of Global Business Mobility visa (UK Expansion worker, secondment worker, service supplier, etc.)

Employees who apply for these types of visas will need to have a certificate of sponsorship assigned by you.

As a business owner, do I have to get Indefinite Leave to Remain before applying for British citizenship?

You would have to earn ILR status and remain in the UK legally for another 12 months before thinking of applying for British citizenship (unless you’re married to a British citizen, in which case you don’t need to abide by the 12-month rule).

Can I start a business under a Spouse Visa?

There are currently no restrictions on the types of work that residents under a spouse visa may perform, meaning that they’ll be able to start a business or be self-employed if they wish, without the need to switch to a specific visa for those purposes.

About Carson Derrow

My name is Carson Derrow I'm an entrepreneur, professional blogger, and marketer from Arkansas. I've been writing for startups and small businesses since 2012. I share the latest business news, tools, resources, and marketing tips to help startups and small businesses to grow their business.