I'm a U.S. citizen, resident in Europe
(not UK), with a boat purchased and registered in the UK.
If you are planning to keep the boat based in the UK, then a UK flag and registration is a good way to go.
There are two registries in the UK:
Part 1, which is the formal ship registry. Requires a tonnage survey
but is a very good registration with impressive documentation
which is valid everywhere.
Part 3, which is the "small ships registry", which is a fairly informal scrap of paper invented to satisfy the French, who were harassing UK sailors in unregistered boats (registration is not required in the UK but is required in France).
For Part 1 registration, you can form a UK company to hold the title -- as I did. This is cheap
and straightforward. I use a marina address as the company's legal
address, but you need permission from the marina to do this. After Brexit, apparently Part 1 registration will be opened to U.S. citizens -- but check that, the situation has changed several times. But in any case, you can do it with a company which can be formed online in 5 minutes.
Part 3 registration is not available to companies, only physical persons, and you must have a UK address. I'm not sure whether you are legally required to be a UK resident or not, but in any case quite a few people who are not resident just use a friend's address and apparently get away with it -- do this at your own risk.
But I wouldn't bother with Part 3 registration unless you are never planning to sail far away. Part 1 is easy enough.
As far as insurance is concerned, I did not have any trouble obtaining insurance despite not being a UK resident. I use Pantaenius and am quite happy with them.
For more in depth
information and even assistance, contact the RYA. Join the RYA and you will then have access to a large volume of legal
materials, and you can even ask questions of the RYA legal department. It's a great organization and a great deal.
A couple of other points:
is tax-free in the UK. There is no annual tax of any kind if you keep the boat in the UK.
2. However, boats used by EU residents must be VAT paid. Usually if VAT was paid at initial purchase
and the boat was not sold outside of the EU, this status is retained forever. If you are a non-EU citizen resident outside of the EU, you could theoretically use a non-VAT paid boat in the UK, taking it out of the EU every 18 months (like sailing to Guernsey). This is called the "temporary importation scheme". But it's a faff and probably not worth it, especially if there is a risk you will ever be resident in the EU, unless you're getting a knock-down price
because of the VAT status.
3. Brexit will probably happen sooner or later (maybe even 31 October), and a lot of this will change. We don't know all of the possible consequences, but it seems that a VAT paid boat will become EITHER VAT paid in the EU OR VAT paid in the UK, and not both, depending on where the boat is physically located on Brexit day. Take care with this, and other possible consequences.
4. If the boat was built after 1990 (or whatever date around then where the cutoff was), be sure it is CE marked and certified.