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How to Set Up a Business in the USA from the UK: A Guide for Entrepreneurs
At doola, UK founders often ask us the most important questions:
🔍 When’s the right time to expand to the U.S. from the UK?
🔍 How do I register my business in the States?
🔍 What contracts do I need?
🔍 How do I hire people there or offer share options to overseas employees?
If you’ve been pondering the same, you’re in the right place!
The US, with its massive entrepreneurial market and attractive incentives (thanks to the Inflation Reduction Act), continues to be a prime destination for UK businesses looking to expand.
With potential tax breaks and government subsidies on the table, it’s no wonder overseas entrepreneurs are eager to set up shop stateside.
In this guide, we’ve rounded up all the must-know details for UK entrepreneurs looking to make their mark in the American market.
The process of setting up a business in the USA might seem daunting, but trust us, with the right know-how (and a little help from doola!), it’s much easier than it looks.
From picking the best state for your business to tackling legal and tax hurdles, this guide will walk you through it all.
Book a consultation and let’s doola it!
Why Set Up a US Business from the UK?
Before diving into the how of setting up your business in the USA, let’s explore why so many UK entrepreneurs are making the leap across the Atlantic for expansion:
1. Access to a Huge Market
With over 330 million people ready to swipe, scroll, and spend, the USA offers a massive market to growth-first UK businesses to thrive and innovate.
2. Favorable Tax Environment
States like Delaware and Wyoming have rolled out the red carpet for UK businesses!
Zero corporate income tax, minimal franchise fees—it’s practically a fiscal holiday, making them ideal for foreign business owners.
3. Global Credibility
Expanding to the US isn’t just a geographic move, it’s a credibility upgrade.
A US presence amps up your international reputation, making you more appealing to clients, investors, and partners.
4. Accelerated Growth
With a GDP of $26.24 trillion and a thriving venture capital ecosystem, the US can fuel your business’s global growth, leading to higher valuations and more investment opportunities.
5. Industry Powerhouse
Whether it’s finance in New York or tech innovation in Silicon Valley, the USA is the go-to destination for industry leaders.
If you want to swim with the sharks, this is the ocean!
6. Access to Top Talent
With top universities and cutting-edge innovation hubs, the USA is brimming with top-tier talent. From tech innovators or business strategists, your business can tap into an incredible talent pool.
Now that you’ve got the big picture, the next step is making it happen.
But you’re probably thinking, “But how do I actually do this?”
That’s where doola comes in. We’ll handle the nitty-gritty—LLC formation, compliance, paperwork—while you focus on what matters most: growing your business and taking over the world.
Talk to an expert to understand the growth and expansion potential of your UK business in the US.
9-Step Guide for UK Entrepreneurs
doola has helped top UK entrepreneurs set up and scale their US businesses—the American dream, as they call it!
And now, it’s your turn.
This 9-step guide will walk you through everything you need to know—from choosing the right structure to managing taxes—so you can hit the ground running in the land of opportunity!
Let’s dive right in.
Step 1: Choose the Right Business Structure
Your first decision will be choosing the business structure that fits your vision like a glove.
Among existing options like C-Corp, S-Corp, or Partnership, UK entrepreneurs often find that forming a Limited Liability Company (LLC) is the real MVP.
Here’s why:
a. Limited Liability Protection:
An LLC keeps your personal assets safe from any business-related lawsuits or debts.
Your home and savings can breathe easy!
b. Flexibility:
You can choose to manage the business yourself or hand over the reins to a trusted manager.
An LLC lets you decide how you run the show.
c. Pass-through Taxation:
Most LLCs enjoy “pass-through” taxation, meaning your profits are taxed once—no additional corporate tax!
Let’s Talk Costs:
For the ease of comparison, let’s say you are considering LLC costs in Delaware vs. Wyoming.
Setting up an LLC in Delaware will set you back about $90 for the filing fee, plus a $300 annual franchise tax. If you’re eyeing Wyoming, you’re in luck! It’s only $100 to form an LLC and a mere $60 annual fee
Similarly, you can weigh your options for other states.
Or, you may speak to our experts.
What if you form a corporation instead?
If you were to form a corporation instead of an LLC, you’d be looking at more complex tax filings and double taxation on profits.
That’s why UK entrepreneurs looking to break into the US market prefer forming LLCs—they’re simpler, more affordable, and way less taxing (literally)!
Step 2: Pick the Best State for Your LLC
Not all states are created equal when it comes to business regulations and taxes. Choosing the right state for your LLC is critical.
Here are three popular choices for UK entrepreneurs:
➡️ Delaware: Business-Friendly Laws, Flexible Taxes
Known for its business-friendly laws and minimal tax requirements, Delaware is a top pick for foreign businesses and home to:
67.8% of Fortune 500 companies and 1.5 million corporations.
Delaware’s Court of Chancery specializes in corporate law, meaning any legal issues that arise can be resolved quickly.
- Filing an LLC costs around $90
- You pay an annual franchise tax of $300
➡️ Wyoming: Flexible Listing, Better Privacy
Offering no corporate income tax and a low annual report fee, Wyoming is another great option. Wyoming also doesn’t require LLCs to list their owners in public records, giving you a level of privacy.
You just need to pay:
- Filing fee of $100
- Minimal annual report fee: $60
➡️ Nevada: Tax-Friendly and Flexible
Nevada offers zero state income and corporate taxes, and you don’t even need to set foot in the US—perfect for UK-based entrepreneurs.
A bit pricier at $425 to file, Nevada is still a good option for UK entrepreneurs looking for a tax-friendly setup from afar.
doola Tip:
If you’re planning to operate entirely online, Delaware and Wyoming offer the best mix of low fees and business-friendly regulations.
Step 3: Hire a Registered Agent
Every LLC in the USA must have a registered agent—a person or entity located in the state of your LLC that can receive legal documents and official notices on your behalf.
This is particularly important for UK-based business owners, as you won’t have a physical presence in the US.
Why do you need a registered agent?
✅ Mandatory for LLCs:
Every US LLC must have a registered agent to handle important legal and tax communications.
✅ Receives Official Mail: Your registered agent will receive:
- Compliance notices (like annual reporting and filings)
- Tax documents from federal and state revenue departments
- Services of process (if your company faces legal action)
Key Things to Remember
✅ Registered Agent Address: This must be a physical address in the state where your LLC is incorporated.
✅ Your Legal Business Address: This should be your UK business address, not the registered agent’s address. You’ll use your business address for:
- Opening business bank accounts
- Sending and receiving invoices
- Filing for legal contracts, permits, or licenses
How doola Can Help
You don’t need to live in the US to register a US corporation, but you do need a registered agent.
While you could hire a local service, doola offers registered agent services that ensure all official documentation is received promptly and securely, no matter where you are in the UK.
This takes the hassle out of managing your US business from abroad.
Step 4: File LLC Formation Documents
Once you’ve chosen a state and hired a registered agent, the next step is to file your LLC formation documents, also known as Articles of Organization.
These documents outline the basic details of your LLC, including:
- LLC Name: Choose a unique business name that complies with the state’s naming rules.
- Registered Agent: Include your registered agent’s name and address.
- Business Address: This can be your UK address or a virtual office in the USA.
- Management Structure: Specify whether your LLC will be managed by members (owners) or managers.
Filing Fees
Filing fees for forming an LLC in the US can range anywhere from $50 to $500, depending on the state. Here’s a quick snapshot:
➡️ Delaware: Registers LLCs for $125 and offers complete privacy for LLC members. Plus, if you’re an out-of-state resident, you won’t have to worry about individual income taxes.
➡️ New Mexico: A budget-friendly $50 to set up an LLC, but the state income tax ranges between 1.7% and 5.9%. While not tax-free like Delaware or Texas, it’s still relatively low compared to other US states.
So, whether you’re prioritizing low filing costs or tax breaks, your options are flexible.
Step 5: Get an Employer Identification Number (EIN)
To legally operate your business in the USA as a UK entrepreneur, you’ll need an Employer Identification Number (EIN) from the IRS.
Think of it like a business Social Security Number. It’s essential for:
- Opening a US business bank account
- Hiring employees
- Filing taxes
The EIN is issued by the IRS, the federal institution governing taxes in the USA. It’s a crucial step to set up business, hire personnel, and stay compliant with federal and state regulations.
How to Apply for an EIN
As a UK-based business owner, you have a few options for applying for an EIN:
- Apply online via the IRS website
- Fill out and submit Form SS-4 via mail, fax, or phone
The process is free and can be completed in a few days. However, doola takes the stress off your plate by managing the entire EIN application process for you.
Once secured, the EIN allows you to handle tax filings, payroll, and business banking in the US.
Why Your US Business Needs an EIN
Having an EIN is essential for multiple reasons, especially for non-US entrepreneurs:
📌 Filing taxes: You’ll need an EIN to report income and fulfill tax obligations at both federal and state levels.
📌 Opening a US bank account: Most banks require an EIN to set up a business account, helping to separate personal and business finances.
📌 Hiring employees: You need an EIN to pay payroll taxes and report wages to the IRS.
📌 Privacy and security: It minimizes identity theft risks and keeps your business separate from your personal tax ID.
📌 Establishing business credit: An EIN helps you build credit history and access loans to grow your business.
Nexus and Multi-State Filing
If you expand your business to multiple states, the EIN becomes even more critical. You’ll need to file within each state where your business has a “nexus” or presence.
An EIN connects your business to state and federal tax systems, ensuring you’re compliant with all legal and financial requirements.
By securing an EIN, your business is set up to thrive in the US, and with doola’s help, you can focus on growth while leaving the technicalities to us.
doola: EIN Included with LLC Formation
With doola, your EIN application is filed directly with the IRS, ensuring you get your official identification number without the headache.
We’re here to streamline your business journey, taking care of all the IRS paperwork so you can focus on what really counts—building and growing your business.
Ready to make things official? Get your EIN with doola today and hit the ground running!
Step 6: Open a US Business Bank Account
Opening a US business bank account will help you manage your finances, accept payments from US clients, and keep your business funds separate from personal finances.
However, many US banks require you to visit a branch in person, which can be a hurdle for UK-based entrepreneurs.
Luckily, some online banking solutions like Mercury allow you to open a US bank account without being physically present in the USA. These platforms offer low fees and are designed with international entrepreneurs in mind.
Step 7: Understand US Taxes and Fees
Your dream to form a US business is made simpler by doola, however:
Doesn’t mean you’re off the tax hook!
We know, the US tax landscape can be a tricky maze of federal, state, and sometimes local taxes.
So here’s a simple breakdown for you:
✅ Federal Taxes:
Most LLCs are subject to federal income tax. If your LLC operates as a pass-through entity, the profits flow directly to the owners, meaning you’ll report them on your personal tax return.
✅ State Taxes:
Depending on the state, you may also be subject to state income tax or franchise tax.
Example:
Wyoming has no state income tax, while California levies both corporate and personal income taxes.
✅ Sales Tax:
If you sell goods or services in the USA, you may be required to collect sales tax—your customers will expect it!
Example: State-Wise US Taxes
Let’s say you decide to operate in California.
You’ll be expected to pay a minimum annual franchise tax of $800, along with an 8.84% state corporate income tax.
In contrast, if you set up in Delaware, you’ll only pay a $300 annual franchise fee, saving significant costs depending on your revenue.
It’s a good idea to consult with a US-based tax advisor to ensure that you’re compliant with both US and UK tax obligations.
Consult a tax expert today.
Step 8: Stay Compliant with Latest Regulations
Once your LLC is set up, you’ll need to keep it in good standing by meeting ongoing compliance requirements.
And of course:
Changing tax laws in different states.
Here’s what you need to stay on top of:
🔍 Filing an Annual Report:
Most states require LLCs to file an annual or biennial report. Fees range from $20 to $500 depending on the state.
🔍 Paying Franchise Taxes:
States like Delaware charge an annual franchise tax to maintain your LLC’s good standing.
🔍 Renewing Business Licenses:
Depending on your industry, you may need to renew licenses or permits yearly.
doola is here to help you navigate these ongoing requirements effortlessly.
With our compliance dashboard, registered agent services, and timely reminders for critical deadlines, you can focus on growing your business without missing a beat!
Step 9: Set Up a Virtual Office
At doola, we often encourage UK-based entrepreneurs to dip their toes into the US market before diving headfirst into forming an LLC and the financial commitments that come with it.
Testing the waters from the UK allows you to gauge the demand for your services without the hefty costs of relocation and visas.
This is what it means, in simple terms.
Even if you’re running your business from the UK, setting up a virtual office or a physical presence in the USA can significantly enhance your credibility and help you connect with American customers.
A virtual office provides a professional US business address, mail handling services, and even access to meeting rooms if needed.
Note: While this step isn’t mandatory, it can elevate your brand’s reputation and create a sense of local presence for American consumers.
Create Your Virtual Address with doola
With doola, you can easily access a shared US virtual business address through our various plans.
Plus, we can assist you in acquiring a physical address or utility bill (for an additional cost) via our partners at Virtual Post Mail.
Ready to Set Up Your US Business?
Setting up a business in the USA from the UK might seem like a complex process, but with the right guidance and support, it’s totally doable.
From choosing the right state to handling compliance and taxes, you can establish your LLC in the USA and tap into one of the largest markets in the world.
If you’re ready to make the leap, doola is here to help every step of the way.
With our comprehensive LLC formation and compliance services, we make it easy to start and run your US business—so you can focus on what really matters: growing your brand.
Schedule a free consultation with doola today, and let’s get your US business up and running!