In which country should I incorporate my online business?

[new in the game]

A short description of what I'm planning to do:


I'm developing, along with a partner, a website that will offer social media related services.
The business will be self funded, at least for starters.


I'm looking where should I incorporate my business based on the following criteria and facts:


I'm a Greek citizen and resident (Greece is an EU country).
I want to avoid countries that have a dubious reputation of tax havens etc.
I'm interested in low incorporation cost.
I'm interested in low annual expenses. (Accountants, maybe a person who will act as a CEO in the country where the business will be formed for legal reasons, etc.)
Of course the lower the corporate taxes will be, the better.
The country which I will choose, will be the one that offers the best combination of points 4 and 5.


I look forward to hearing your suggestions!

[vangogh]

Is there a reason why you don't want to incorporate in Greece?

I realize you haven't given a lot of details about your business, but it sounds like you plan on offering freelance social media services. If that's the case I wouldn't worry too much about corporate taxes just yet. Get the business off the ground first. Later when it grows you can incorporate in foreign countries, but my guess is right now you're putting the cart before the horse. Make some money and get the business going first.

[new in the game]

@vangogh

Unfortunately, I can't find a single reason to incorporate in Greece any more. Every year since the crisis started, economy gets worse somewhat in a predictable manner. New austerity measures are common now and come in frequent intervals. I know personally quite a few people who tried their own startups and everyone started their business abroad. All of them searched for investors though, so they incorporated wherever their investors told them. Also, thousands of small businesses moved to nearby Bulgaria...


Corporate tax in Greece is 29%, but there is a down payment of next year's tax and that doubles the rate to 58%! Dividend tax rate is 15%.
If you start a business in Greece it is mandatory to pay for health and pension insurance. The minimum monthly fees for insurance which is calculated according to the business' income, is 180 Euros per person and is going to get a raise this year and a smaller one in 2019.
If you add up the 2 points, you understand that if you operate legally, without tax invading, there is no margin for profit!
Moving a business to another country would cost around 10000 Euros according an accountant I had asked. So what's the point in starting a business in Greece which will not be viable and which will I have to move abroad in the future?

[Harold Mansfield]

Sounds like you're saying you need to move away from Greece and establish residency somewhere else. When you do, incorporate there. We get a lot of "where to incorporate" questions here and for first time start ups with absolutely no assets or revenue this seems like a completely unnecessary complication.

However in your case, if Greece is that bad, the taxes that high, and the economy so terrible...merely incorporating somewhere else doesn't solve all of the other problems. It just creates more complication for something that's (based on what you're saying) already doomed to fail.

[vangogh]

Oh yeah. I forgot about everything that happened financially in Greece the last few years. Now I understand why you'd rather incorporate elsewhere.

I don't know the rules and rates for incorporating all over the world or even here in all 50 states, but I would think that whatever the country, you would need to establish some kind of physical presence for the business. I assume you aren't planning on leasing corporate offices anywhere, that would mean you'll likely need to know someone in the country and use that person's address. I suppose you could find a stranger and pay that person enough, but more likely you're going to have to ask a friend for a favor or move.

You can probably find a lot of information online. I doubt for every country you'll be thinking about, but I bet quite a few. In the U.S you incorporate at the state level and often you'll find the information you need by searching for the website of the secretary of state for each state. It won't always be the site you want, but it's usually a good starting point. I'm sure you can find similar information in other countries too.

Hope that helps.

[HumaneHosting]

Sounds like you're saying you need to move away from Greece and establish residency somewhere else. When you do, incorporate there. We get a lot of "where to incorporate" questions here and for first time start ups with absolutely no assets or revenue this seems like a completely unnecessary complication.

However in your case, if Greece is that bad, the taxes that high, and the economy so terrible...merely incorporating somewhere else doesn't solve all of the other problems. It just creates more complication for something that's (based on what you're saying) already doomed to fail.

I agree for such problems just ship yourself out while your at it. It will avoid many problems later regarding what/how you need follow your mainland lawas vs. "off shoring".

[Paul]

29 % isn't so outrageous. Until this year US corporate rates were higher than that. The US rate is now 21%. A couple hundred to incorporate. On the Health insurance, does that cover all your health care costs? 180 Euros(about $240 US) is not such a bad deal. Its $ 500-$1000 here.

As was said, you need to make money before you worry about taxes. I don't know how Greece handles foreign corps that are actually domiciled in Greece. I think Northern Ireland has a 15 % rate and easy to incorporate. But I agree with others; it seems a ball of extra confusion for now.