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The UK and Canada are two of the world鈥檚 most dynamic economies, each home to a variety of business hubs.

As the working world gets smaller and companies are able to more easily set up shop elsewhere, you might be wondering which is better for starting a business.

Here, we talk you through everything you need to think about, so you can make that big decision just a little easier.

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Business Environment

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To start with, it鈥檚 probably worth taking a closer look at each of these exciting economies and how they compare.

UK:听The UK, though much smaller in size than Canada, has an amazing business economy. As a finance hub on the edge of Europe, it has great relationships with countries like the US, areas of the Middle East and the rest of Europe.

Though Brexit has shaken things up a bit in terms of uncertainties, UK governments are constantly keeping an eye on, and investing in the economy.

Canada:听One of the major benefits of Canada is that it is an incredibly stable economy. With close ties to the US and business hubs like Vancouver and Toronto, it鈥檚 a great option for businesses looking to break into the North American market.

However, it will be interesting to see how Trump鈥檚 government will change existing trade agreements as he adopts more 鈥淎merica First鈥� policies.

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Location

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Another factor worth thinking about is what type of markets you want to primarily trade with. As the UK and Canada sit in two different continents, location can make a difference.

UK:听The UK sits on the edge of Europe and is just 2-3 hours鈥� time difference from the Middle East. It also sits along the same time zone as many African Countries.

For this reason, it鈥檚 a good hub for those looking to trade in Europe, the Middle East and North Africa. The UK also has strong ties with the US, though the time difference can make things tricky, especially on the West Coast.

Canada:听Canada is an incredibly strategic location for companies looking to trade in the Americas. Its major cities are on the same timezones as those in the US, making collaboration easy.

Canada also has trade deals with the US and EU, making it a solid choice for international companies.

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Taxes

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Of course, one of the biggest things that changes from country to country is the tax rate. Here鈥檚 how they match up.

UK:听In the UK, companies will pay between 19 鈥� 25% in corporate taxes.

Income taxes range between 20-45% after you鈥檝e earned your basic allowance of 拢12,570. The 40% rate of tax kicks in after you earn 拢50,270, making it quite a costly tax environment.

Canada:听Canadian corporate taxes work slightly differently, as the country has both federal and provincial tax rates.

The federal rate sits around 38%, however this is subject to a few deductions based on where your company is based and what it has earned.

Federal income tax sits between 15-33% but the high earner bracket is higher than the UK at $235,675.

Individuals also pay provincial income tax, which varies depending on where they live.

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Cost Of Living

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When starting a business abroad, you also need to think about the cost of living. This can impact your own expenses, as well as the costs you will need to rent offices, pay staff and more.

UK:听Like anywhere around the world, Capital cities tend to be the most expensive. By quite a big chunk, London is the most expensive area in the UK, with monthly costs sitting around 拢2,550 for a single person, including rent. (uHomes).

Transport, food and activities are also expensive in the UK, however cities like London do also come with high wages.

Canada:听Canada is a vast country, but if you鈥檙e wanting to set up a business there you鈥檙e probably eyeing up either Toronto or Vancouver.

According to MovingWaldo, The average cost of living in Vancouver is $3,793.63 per month, with the average cost of living in Toronto sitting at $3,523.17 per month. These are both expensive, but the salaries and lower income tax bands certainly help.

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Wages

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If you are looking to hire workers in these countries, minimum wages are worth looking into.

High wages mean businesses will need higher profits to pay staff fairly.

UK:听Minimum wage in the UK sits at 拢10 per hour, with the living wage (for 21+) sitting at 拢12.21 per hour.

Based on a full work week at 7 hours a day, this would cost 拢477.35 per week.

Canada:听Canada鈥檚 minimum wage is $17.30 per hour, with overtime commanding 1.5x this wage. Some provinces might also have their own minimum wages, so it鈥檚 worth comparing them too.

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UK vs Canada: Which Is Better For Business?

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When choosing between the UK and Canada, the answer is: It depends on your business!

If you are looking for a location that can help with US trade ties, Canada might be the right choice. However, if you want more global reach, the UK may be better.

Start by weighing up the pros and cons and then working out what works best for you.

Good luck!