How to choose a country for business relocation?

Approaches

Usually, in matters of opening a business abroad, there are two main points to be worked out with the client.

The first is to look for a specific jurisdiction for the client’s tasks and activities.

The second is to adapt to the jurisdiction (if the client moves to another country, it is worth studying the nuances of doing business in such a country).

Country selection criteria

Let’s consider the main criteria for choosing a country for business relocation.

The taxation system. It is necessary to check what types of taxes the company pays in the country, what tax rates are applied, whether there are preferential tax conditions. Companies with low costs will be attracted to countries with low tax rates. If the country has a large turnover, then standard tax rates are suitable.

Dividends. How are dividends paid (periodicity, amount, requirements), what is the tax rate for paying dividends. What is the income of the owners of the company.

Tax residency. In which country to declare income and pay taxes.

Workers. To begin with, analyze which of the employees can move to another country, for what period (temporary or long-term). It is planned to move only the employee, or the employee and his family members. What steps must be taken before employment (for example, renting an apartment, obtaining a tax number, a work permit). What is the minimum guaranteed salary. How taxes are paid. Is there an obligation to employ residents of the country.

Business launching. Choose countries where there are no or minimal barriers to starting a business. There are no difficulties for foreigners to open a company.

Bank account. In some countries, the personal presence of the director and/or founder of the company is required to open an account. There are countries where it is not possible to open an account in a bank, but payment systems are used.

Costs. Calculate potential costs for company registration, authorized capital, salaries, office rent, accounting, other additional costs for organizational issues.

Country specialization. As a rule, countries specialize in the production of certain types of goods and services. Therefore, it is possible to consider a country where there are capacities for the deployment of one’s own business, a program of support and development of specific industries. At the same time, do not forget about the competition in the market with the business that already exists.

Digitization. Digital and innovative technologies are developed, including in business processes. Quick access to any data. Fewer errors in calculations, analysis, planning.

Cryptocurrency. In most countries, activities in the field of cryptocurrency are unregulated. But there are loyal countries where it is possible to get a permit or a license to operate.

Other criteria. Geographical proximity to Ukraine, developed infrastructure, logistics, business connections, access to credit, exemption from double taxation, etc.
The list of criteria is not exhaustive. We focused on the most important decisions for choosing a country for doing business.

Conclusions

The choice of jurisdiction should be approached comprehensively, and experts should be involved for help. Its perspective and profitability depend on the correct planning and structuring of the business. Opening a business abroad has its advantages – it is access to large global sales markets, business support programs, increased access to innovative technologies, economic integration, and new international business connections.

By contacting us, you will receive a questionnaire, on the basis of which we will hold an introductory meeting and define your tasks. At the consultation, a professional lawyer will help you choose the form of business incorporation for your situation and guide you in matters of further support.