US LLC vs UK Ltd
A US LLC and a UK private limited company are both quick to set up online for non-residents, but they are taxed in opposite ways. A single-owner LLC is disregarded for US federal tax, so profits are usually taxed where the owner lives; a UK Ltd is UK resident by incorporation and pays corporation tax of 19% to 25%.
Updated
The table compares tax, residence, filings and dividends. The UK figures come from HMRC and Companies House, the US figures from the IRS, FinCEN and the Wyoming Secretary of State.
| Criterion |  United States |  United Kingdom |
|---|---|---|
| Tax on company profits | Single owner: disregarded entity by default, so no federal tax at company level unless it elects corporate treatment | 19% on profits up to £50,000; 25% on profits over £250,000; marginal relief in between |
| Company tax residence | A disregarded LLC is not a separate taxpayer; the foreign owner is taxed in the US only on US-source or effectively connected income | UK resident by incorporation (CTA 2009, s.14), wherever the directors live |
| Owners and management | Single member: disregarded entity; 2+ members: partnership by default (unless corporate treatment is elected) | At least 1 director who is a natural person, aged 16 or over |
| Registration | State filing through a registered agent; EIN from the IRS, online only with an SSN or ITIN | Online, usually within 24 hours; identity verification for new directors and PSCs mandatory since 2025-11-18 |
| Annual filings | Form 5472 with a pro forma Form 1120, by fax or mail; state annual report | Accounts 9 months after year end (first accounts 21 months after incorporation); confirmation statement at least every 12 months; corporation tax due 9 months and 1 day after the period |
| Beneficial ownership | Federal BOI report not required for US-formed companies (final rule effective 2026-08-14) | People with significant control verified with Companies House; companies no longer keep their own registers since 2025-11-18 |
| Dividends to non-resident shareholders | 30% US withholding unless a treaty reduces it, once the LLC is taxed as a corporation | No UK withholding tax on ordinary dividends |
| VAT | No federal VAT; sales tax is set by each state | Registration required above £90,000 taxable turnover in 12 months |
| Banking partners in our network | 9 | 35 |
- Tax on company profits: IRS, LLC classifications (United States); HMRC, Corporation Tax rates and marginal relief (United Kingdom). As of 2026-10-25.
- Company tax residence: IRS, LLC classifications and effectively connected income (United States); Corporation Tax Act 2009, section 14 (United Kingdom). As of 2026-10-25.
- Owners and management: IRS, LLC classifications (United States); Companies Act 2006, section 155 (United Kingdom). As of 2026-10-25.
- Registration: IRS, Get an employer identification number (United States); GOV.UK, register your company, and Companies House, ECCTA transition plan (United Kingdom). As of 2026-10-25.
- Annual filings: IRS, Instructions for Form 5472 (United States); GOV.UK, accounts and tax returns for private limited companies, and Companies House (United Kingdom). As of 2026-10-25.
- Beneficial ownership: FinCEN, Beneficial Ownership Information Reporting (United States); Companies House and changes to UK company law, company registers (United Kingdom). As of 2026-10-25.
- Dividends to non-resident shareholders: IRS, NRA withholding (United States); HMRC Savings and Investment Manual, SAIM5120 (United Kingdom). As of 2026-10-25.
- VAT: HMRC, VAT Notice 700/1 supplement (United Kingdom); the United States levies no federal VAT, and sales tax is a state matter. As of 2026-10-25.
General information, not legal or tax advice. Approval always rests with the institution or authority.
Our take
A US LLC suits founders who want the profits taxed only where they live, sell to US customers or platforms, and accept a federal information return with a USD 25,000 penalty if it is missed.
A UK Ltd suits founders who want a company that pays its own tax and that customers, marketplaces and the UK's many payment providers know well, and who accept UK corporation tax and annual accounts. With either, managing the company from your country of residence can make it taxable there too.
Questions
Is a US LLC or a UK Ltd better for a non-resident?
A US LLC usually suits a solo founder who wants profits taxed where they live. A UK Ltd suits a business that wants a company paying its own corporation tax, with no UK tax withheld on dividends paid abroad. Your country of residence decides much of the outcome either way.
Does a UK Ltd pay tax if the owner lives abroad?
Yes. A UK-incorporated company is UK resident for corporation tax wherever its directors live, so it pays 19% on profits up to £50,000 and 25% above £250,000, with marginal relief in between. The UK withholds no tax on ordinary dividends.
How fast can I register each company?
A UK company is usually registered online within 24 hours, once directors and people with significant control have verified their identity. A US LLC is a quick state filing through a registered agent; the EIN from the IRS takes longer for owners without an SSN or ITIN.
The jurisdictions in this comparison
- US LLC formation for international foundersA US limited liability company (LLC) is a state-registered company that non-US founders use to invoice clients, hold assets and access US payment rails. A single foreign owner's LLC is disregarded for federal income tax by default, but as of October 2026 it must still file Form 5472 every year.Learn more
- UK limited company formation for international foundersA UK private limited company (Ltd) is a separate legal entity, owned by shareholders and run by directors, that non-residents can register online with Companies House. As of October 2026 registration usually takes 24 hours, and directors and people with significant control must first verify their identity.Learn more
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Not sure which one fits?
Tell us about your situation and we recommend the jurisdiction and structure that suit it.