Best countries to incorporate your Business
Best Countries to incorporate your Business
Doing business overseas and developing globally is the fundamental aspect of every business. In fact, global growth is a defining point and a matrix that rates the success of any business.
To incorporate the business overseas or to relocate your existing business is quite a challenging task that requires an astute mix of proper management planning, logistical support, financial flows, precise jurisdictions, tax incentives, knowledge of marketing policies, etc.
Incorporating or registering a company overseas is one of the pivotal ways to manage worldwide commercial activities. Business setup in many countries offers excellent approach for every business firm to expand its presence across the world by optimizing its capital, manpower, technology and information.
A country that not only ranks high in terms of ease of doing business but also offers maximum tax benefits is indeed the best location for residents across the world to incorporate a Company.
What are the Best Countries to incorporate your Business?
(Criteria for each country are both objective and subjective. You must do further research if one country appears to be suitable for your business.)
1. British Virgin Islands
Minimum Setup Requirements to Register a Company
Director — 1
Shareholder — 1
Company Secretary — 1
All the above 3 roles can be appointed to one person.
Registration Timeline
There is no fixed timeline. As long as you have prepared the documentation, you’ll find it a simple and smooth process.
Steps to incorporating in the British Virgin Islands:
Reserve your Company Name
Appoint a Registered Agent
Open a bank account
Submit all relevant documents
Accounting
As mentioned earlier, companies are not required legally to prepare or file any financial accounts, annual returns or records
Corporate Tax Requirements
There is no need to pay any form of taxes, except for Payroll Tax/ Real Property Tax and Stamp Duty Tax, in the BVI.
Annual General Meeting
BVI-incorporated companies are not required legally to hold an Annual General Meeting each year.
2. Hong Kong
Minimum Setup Requirements to Register a Company
Designated Representative — 1
Individual Director — 1
Shareholder — minimum 1 and maximum 50
Company Secretary — 1, must be based in Hong Kong
No minimum share capital requirement
Have a local Hong Kong registered address for the company
Registration Timeline
Around 5 to 7 days (subjected to the completion of the required documents).
Steps to incorporating in Hong Kong:
Get Companies Registry’s Approval for Your Company Name
Prepare Documents to Set Up A Hong Kong Company
Submit Application to Companies Registry
Accounting
All private companies must keep and maintain proper books of account. Companies must also file annual returns specifying directors, members and the location of a registered office.
Annual General Meeting
All companies must convene its annual general meeting in respect of each financial year of the company, as opposed to every calendar year.
Annual filing
All Hong Kong-based companies are required to meet annual filing requirements with the Inland Revenue Department (IRD) and Companies Registry, once every calendar year.
3. Singapore
Minimum Setup Requirements to Register a Company
Shareholder (individual or corporate entity) — 1
Resident Director — 1
Company Secretary — 1
Initial paid-up share capital of at least S$1
A Singapore registered office address
Registration Timeline
Only 2 days (subject to the receipt of complete documents).
Steps to incorporating in Singapore
Get ACRA’s Approval for Your Company Name
Prepare Documents to Set Up A Singapore Company
Submit Application to ACRA
Accounting
Singapore companies need to keep accounting books in order. And filing of annual financial statements with ACRA in XBRL format.
Annual General Meeting
Every company must convey its AGM in every calendar year and table its financial statements for the shareholder’s scrutiny.
Corporate Tax
The due dates of company tax filing are 30 November (paper-filing) and 15 December (e-filing).
Annual filing
The Companies Act requires that you perform certain annual filing processes in order to comply with the relevant commercial regulations in Singapore. The Annual Returns Filing must occur with a month of its AGM.
4. Japan
Minimum Setup Requirements to Register a Company
Representative Director — 1
Shareholder — 1
Official office address for place of business
Registration Timeline
The entire process of incorporation takes approximately 2 to 4 weeks.
Steps to incorporating in Japan
Deciding your Business Structure
Choose a Company Name and Register your Office Address
Prepare and Notarise the Articles of Association
Submit the company registration documents
Prepare Company Seals
Japan Corporate Number
Once incorporated, each Japanese company will be issued a 13-digit Corporate Number. This Corporate Number can be used for identification and application for different services.
Accounting
Japanese companies can select from 4 types of accounting standards to comply with for accounting purposes. The 4 types allowed are Designated IFRS/ US GAAP/ JMIS/ J-GAAP. Accounting records must be filed each fiscal year.
Corporate Tax Requirements
The national standard corporate tax rate is at a fixed rate of 23.2%, applicable to companies with share capital exceeding JPY100 million.
Annual General Meeting
The annual general meeting needs to be held within 3 months of the end of each fiscal year.
5. United Kingdom
Minimum Setup Requirements to Register a Company
In the UK, there are 2 common types of companies — private and public companies.
For private companies, the requirements are:
Director — 1, at least 1 director must be an individual director
Shareholder — 1
For public companies, the requirements are:
Directors — 2, at least 1 director must be an individual director
Company Secretary — 1
Shareholder — 1
Registration Timeline
In the UK, the incorporation process can be done on 3 different platforms. For each platform, the timing differs.
Electronic Software Filing
The standard fee for this platform is £10 and usually takes 24 hours.
Web Services
The standard fee for this platform is £12 and usually takes 24 hours.
Paper Filing
The standard fee for this platform is £40 and usually takes 5 working days.
Steps to incorporating in United Kingdom
Submit relevant forms
Open the company bank account
Register your company for Corporation Tax
Accounting
The accounting year must not be longer than 12 months and it usually follows the financial year. In the event that the accounts cover more than 12 months, you must file for 2 returns.
Corporate Tax Requirements
Once you have registered for Corporate Tax, you must keep all accounting records and prepare a Company Tax Return. The deadline to pay the tax (or to declare nothing to pay) is 9 months and 1 day after the end of the accounting period. The average corporation tax payable is 19%.
Annual General Meeting
For public companies, the AGM must be held annually within the period of 6 months beginning with the date following its accounting reference date.
6. New Zealand
Minimum Setup Requirements to Register a Company
Director -1
Shareholder — 1
*The shareholder can be the director
Official Local Office Address
Local registered agent
At least one director must reside in either New Zealand or Australia.
Registration Timeline
All other procedures must be completed and approved within 20 working days to successfully incorporate your company.
Steps to incorporating in New Zealand
Reserve a Company Name
Registering your Company
File the required Consent Forms
Accounting
All New Zealand registered companies might be audited yearly. Therefore, it is advisable to keep detailed documentation of the company.
If your company is a subsidiary of a company incorporated outside of New Zealand, and the total assets of the entire company is more than NZD$20 million or have total revenue of more than NZD$10 million, you will have to file audited financial statements.
If your company has more than 25% of its voting shares held overseas, and the total assets of the entire company is more than NZD$60 million or have a total revenue of more than NZD$30 million, you will have to file audited financial statements.
Annual Return Filing
On top of tax returns and financial statements, all New Zealand incorporated companies need to submit an annual return.
Corporate Tax Requirements
All New Zealand incorporated companies are taxed on worldwide income. The current tax rate is 28%.
Annual General Meeting
The meeting must be no later than 6 months after the company’s balance date and no later than 15 months after the previous annual general meeting.
For newly incorporated companies, the annual general meeting must be held within 18 months of the first day of business.
7. Australia
Minimum Setup Requirements to Register a Company
For a proprietary company:
Director (must reside in Australia) — 1
Shareholders (crowd-sourced funded, majority must reside in Australia) — 2
For a public company:
Director (majority must reside in Australia) — 3
Company Secretary (must reside in Australia) — 1
Steps to incorporating in Australia
Decide on your business structure
Establish internal governance structure
Appointment of key officeholders
Registering your business with the ASIC
Tax registration and compliance
Accounting
All transactions relating to the business’s tax and superannuation issues, as well as tax returns and reports, must be kept in the company’s records. For companies with more than AUD$10 million annual turnover
Annual General Meeting
All companies must convene its annual general meeting within 18 months of initial incorporation and subsequently, within five months of the end of every financial year.
Corporate Tax
All “small business” companies are required to pay a corporate tax rate of 27.5%, unless their annual turnover does not hit the minimum of AUD$50 million. All other companies are subjected to the full 30% on their taxable income.
Annual filing
All businesses operating in Australia must submit financial reports with ASIC and this is done usually towards the end of the financial year. Annual financial reports must be submitted for auditing as well.
8. Thailand
Minimum Setup Requirements to Register a Company
There are various business structures to consider for incorporation in Thailand.
Director Requirements:
Private Limited Company: at least 1
Public Limited Company: at least 5, with majority residing in Thailand
Nationality/Residency of Officeholders Requirements:
Private Limited Company: no requirements unless required internally
Public Limited Company: majority of directors must reside in Thailand. No requirements for shareholders
Minimum Capital Requirements:
Private Limited Company: minimum of 15 Baht
Public Limited Company: no minimum
Shareholder Requirements:
Private Limited Company: at least 3
Public Limited Company: at least 15
Registration Timeline
The entire incorporation process should take around 14 working days.
Steps to incorporating in Thailand
Reserve a Company Name
File a Memorandum of Association (MOA)
Convene a Statutory Meeting
Company Registration
Tax and Value added Tax (VAT) Registration
Accounting
Company accounts must be kept at the place of business and be regularly updated. The auditing for the company must also be done by a qualified Certified Public Accountant of Thailand.
Corporate Tax Requirements
In general, the Corporate Income Tax rate is 20% for all Thai registered companies. However, for companies with paid-in capital not more than 5 million Baht at the end of the accounting year are subjected to tax rates as followed:
Annual General Meeting
The Annual General Meeting must be held within 4 months of the fiscal year end as required by law.
9. Indonesia
Minimum Setup Requirements to Register a Company
There are different forms of business entities in Indonesia, listed below are the top 2 common entities in the Indonesian business scene.
Local Company (PT PMDN)
Local Shareholders — 2
Local or Foreign Director, must have a Tax ID — 1
Local Commissioner — 1
Foreign Investment Company (PT PMA)
Local or Foreign Shareholders — 2
Local or Foreign Director — 1
Local of Foreign Commissioner — 1
Registration Timeline
The estimated process to complete registration is roughly 2–3 months and costs around IDR 2,000,000.
Steps to incorporating in Indonesia
Obtain a Company Name
Deed of Establishment
Application for the Certificate of Company Domicile
Obtain a Tax Registration Number (NPWP)
Obtain the Business Identification Number (NIB)
Apply for other relevant documents
Accounting
Accounting records must be filed every fiscal year (1st January — 31st December).
Corporate Tax Requirements
The amount payable in tax is dependent on the net income that a company obtains within a fiscal year. For big companies it is around 20% while small enterprises are given a 50% tax discount rate. Additionally, there is a flat 25% tax rate on corporate income.
Annual General Meeting
Companies are usually required to hold their Annual General Meeting at least 6 months after the end of their financial year.
In addition to the above mentioned countries, here are few considered for incorporation.
10. Georgia
Georgia’s economy is considered to be one of the fastest growing economies in the whole of Eastern Europe with the agricultural sector, real-estate, and tourism and hospitality as the leading contributors to the growth of its economy.
No wonder it is called an entry gate to the Caucasus and Central Asia. If you are looking towards starting a business in
Benefits of starting your business include:
Free Industrial Zones (FIZs)
No corporate tax
No income or profit tax
0% property tax
Reduced VAT rates
Special Trade Company
Can sell and re-export foreign goods
Exempt from profit tax on income from selling and re-exporting foreign goods
International Financial Company (IFC)
Conducts business outside Georgia
Located outside any FIZ
Profit received from financial services is exempt from profit tax
The company is penalised if the income exceeds 10% of gross income
Withholding tax rate on dividends, interest, and royalties is only 5%
11. Norway
Norway has a strong economy and most communication with the government can be done digitally.
Registering a property is fast, and complying with tax laws is relatively straightforward. Resolving insolvency in Norway is also low-cost, with fees averaging 1% of the bankrupt entity’s value.
Benefits of starting your business include:
Great for digital nomads, as all communication is done digitally
Focus on tech based business
Highly skilled workers in IT, finance, design and music tech
Entrepreneurs have access to industrial expertise, investors and talent
Economic and governmental stability
Long-standing trade ties with the EU
Well-developed communication and transport infrastructures
12. Isle of Man — Zero Tax
It is legally separate from the UK and from the European Union. This gives some definite advantages to a company formed in the Isle of Man when it comes to doing business in other jurisdictions or holding investments:
Benefits of starting your business include:
Zero corporation tax rate
Sophisticated banking system
Incorporation with a single shareholder possible
Only one director required
Director mustn’t be resident of Isle of Man
Advantageous for holding investment portfolios including commercial property
Suitable for holding intellectual property
13. Denmark
Denmark is seen as one of the easy countries in Europe to incorporate a business in, and it really has some great pros going for it:
Benefits of starting your business include:
With “flexicurity” you get the most flexible hiring and firing rules in the world, reducing the costs of scaling business operations up or down.
You are able to register and finish your incorporation in days, not weeks.
There are no resident requirements for the management, including CEO and Board of Directors.
No notarial deeds.
It’s tax efficient to establish your business in Denmark compared to other Nordic countries.
Danish company law is modern and in conformity with the current EU legislation.
14. Belize
Belize is a good place for an internet entrepreneur to incorporate because:
Benefits of starting your business include:
Banks allow you to set up an account without being on site in Belize
Great for merchant accounts
Can be used for a variety of different businesses
No taxes
Low setup costs
Banks allow high-risk merchant accounts
In Conclusion:
The final responsibility ends with you. Such as
Educate yourself as much as possible on tax and company law,
Learn from other entrepreneurs who have done this before but are less biased,
Seek professional advice,
Cross reference all of this information to find the common truths, and continue to do this until you understand what you’re getting yourself into.
The truth is, there’s no best country to incorporate an online business. There’s no one size fits all solution to company registration. It comes down to your personal residence, company residence and your customers.
