Global Business Solutions

A Subsidiary is a separate legal entity to its parent company. It can carry out all types of legal commercial activity and can employ staff engaged in all functions, including sales, marketing, customer support, product development and R&D.

Establishing a subsidiary need not be costly or over-engineered. Depending on location it is usually possible to establish a subsidiary within one to six weeks. Certain countries, with more onerous registration requirements, such as China, Brazil, India and Mexico can take longer, sometimes up to six months to complete full registration.

Many of our clients establish a subsidiary because of the protection it affords to the parent company and use it to act as the parent company to regional branch offices. Others use it as a regional profit centre as part of a wider global tax planning exercise.

A Branch is often an alternative to establishing a subsidiary in an  overseas country. Registration time is similar to that of a subsidiary, but registration costs are typically greater. An advantage of a Branch is the speed with which it can be closed down should it no longer be required.

It is worth noting that a Branch is not a separate legal entity to its parent company and as such represents an extension of the parent into a new legal jurisdiction. Care and advice should be sought about the potential tax and legal risks that may arise whilst operating through a branch in an overseas country.

A non-Resident employer is generally a non-taxable business registration that can be used for preliminary market research and market entry purposes. Activities of a commercial nature are not typically allowed to be undertaken.

• Country-compliant contracts of employment
• Offer letters
• Contractor arrangements
• New hire induction
• Country-specific employment law key facts
• Policies and procedures/employee handbook
• Performance management/development
• Absence management
• Stress management
• Health and safety obligations
• Discipline and grievance issues
• Collective employment relations; trade union/workers representation
• Terminations
• Redundancy management process (RIF)

Benchmarking services

Guidance on in-country benefit provision

Tax-efficient in-country employee benefit solutions

Stock, stock options and ESPP plans

Total reward statements

Flexible benefits

• Guidance on country specific immigration requirements
• Visa and work permit applications
• International assignment letters
• Cost of living allowances
• Global mobility and relocation services
• Advice on reciprocal tax and social security agreements
• Expatriate tax advisory services
• Repatriation services

• Preparation of monthly management accounts reporting to an agreed timetable and to an agreed chart of accounts.
• Preparation of a monthly cashflow forecast for funding purposes.
• Accounts Payable management and processing of all invoices and expenses.
  
• Maintaining fixed asset register, where necessary.
• Maintaining accruals, prepayments and all other balance sheet controls and reconciliations.
• Bank account management including payment of employees; vendors and tax authorities on your behalf, posting of all transactions and monthly bank reconciliations.
• Preparation of the monthly payroll and payment of salaries across all agreed countries. We will also make the payments of the withholdings to the local authorities together with the payment of any benefits and/or insurance premiums.
• Handling correspondence with your international employees including questions and queries related to expense claims, payroll and vendor payments.

• Quarterly review meeting with you to ensure deliverables are being met and that quality is exceeding expectations.
• Preparation and filing of quarterly VAT/sales tax returns where applicable.
• Preparation and filing of quarterly tax returns, including VAT/sales tax returns, corporate tax payments on account; withholding tax etc.

• Provide a tailored compliance calendar, detailing all filings due and dates in the year.
• Prepare and file the annual financial statements for each of your international subsidiaries and branches, where required.
• Where required by law, work with your auditors to ensure local audit obligations are met.
• Complete and file all annual tax returns, including payroll; corporate income tax; benefit in kind; stock options etc.

If you operate through a branch or a subsidiary overseas you will be required to file a corporate income tax return. These returns are typically filed once a year, but some countries require more frequent filings. Wherever you are operating, Crowe UK will ensure that your returns are prepared and filed in accordance with local rules. 

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Value Added Tax legislation is complex and can have a significant impact on how you might structure your international sales agreements. Whether you are shipping product, selling services or enabling your customers to download software online, there are VAT issues that need to be addressed upfront in order to avoid complication and penalties arising at a later date. Crowe UK professional VAT team can provide full guidance and support for all your VAT issues.

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Where you may have related party transactions between the US parent company and its overseas subsidiaries then these transactions and services should be documented just as they would be if they were with an independent third party. Our tax team can advise and assist you in complying with local country transfer pricing requirements.

If you plan to grant stock awards to your international employees, then you need to be aware of the implications of doing so. The tax treatment of different equity based compensation varies by country and the cost to the employer as a result of a vesting or an exercise can be significant. With advice and planning it may be possible to take advantage of some favourable local country tax laws and Crowe UK can assist you.

If you intend to send one or more of your home country employees overseas for a period of time, you will most likely be required to comply with host country tax and social insurance regulations. Crowe UK provides an end-to-end tax service that will give you and your employee peace of mind and advises on the most tax efficient structuring of the international assignment.

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