The ease of doing business across countries in the EU gives you access to a massive market of potential customers. That said, there’s a lot to consider when you want to register a business in the region.
It’s important to understand the legal and tax frameworks in the country you’re registering in. This will affect everything from the type of entity you choose to incorporate to processing the paperwork.
Our 6-step guide will help you tick all the right boxes when registering your company in Europe. While we’ve covered as much information as possible in this article, it’s always a good idea to work with a local legal or tax professional to ensure that you’re complying with all relevant laws and regulations.
6 Steps to Register Your Business in the EU
- Understand the local laws and regulations. There are 27 countries in the EU, each with its own national laws regarding starting new businesses. It’s important to fully understand exactly which laws will apply to your business in the country where you register as well as those where you operate. Depending on your country of residence, you may find that it makes more financial sense to register and operate in a different state.
- Choose a country to register your business. Naturally, there are advantages and disadvantages of registering your company in different European countries. See more information below.
- Choose your company type. Different countries have different options available, and we’ve provided a detailed list below.
- Complete the registration process. Most EU countries have portals where you can register online. See our list of handy links below.
- Obtain necessary licenses and permits. This can vary depending on the country and your industry, so it’s a good idea to do your homework to make sure you have everything you need.
- Prepare everything you need to start running your business. This can include opening a business bank account, setting up your payment system, and taking any necessary action to protect your intellectual property.
Do All EU Businesses Need to Be Registered?
First things first: Is it necessary to register a business in the EU? The short answer is yes. If you would like to conduct business in one of the member states, you must register your entity.
The EU is made up of 27 member states and each one has its own set of rules and regulations regarding starting a business. It’s important to research the specific requirements for the country or countries where you plan to operate.
Do Online Businesses Need to Be Registered in the EU?
In the EU, online businesses must follow the same rules as brick-and-mortar businesses. This means that an online business does need to be registered.
If you plan to sell goods or services to customers around the world, you’ll want to be able to accept a wide variety of payment methods and currencies. With Pay.com, you can let your customers pay with their preferred payment methods from anywhere in the world.
Pros and Cons of Registering Your Business in Different European Countries
Here are some of the key benefits and drawbacks for each country. You’ll find more information about the types of business you can register in each country below.
- Ireland: A low corporate tax rate of 12.5% and minimal bureaucracy make Ireland an attractive place to open a business.
- Cyprus: Company profits are taxed at 10% and there are no regulations around the nationality of company owners or any requirement for them to be Cypriot.
- Germany: Germany’s solid economy makes it a desirable place to start a business. However, it is known for the complex and difficult bureaucratic processes that govern business registration.
- UK: Although the UK is no longer part of the EU, many tax treaties remain, making it attractive to register a business in the UK.
- The Netherlands: It’s easy to start a company in the Netherlands as there are no restrictions on the nationality or residency of the owners.
- Austria: Setting up a limited liability company in Austria requires a minimum of €35,000 in capital and involves lots of paperwork. Plus, the corporate tax rate is 20%.
- Belgium: After streamlining the process of registering a business, Belgium is one of the fastest and easiest places to register a business in Europe. However, corporate tax is 25%.
- Bulgaria: With a corporate tax rate of 10%, Bulgaria is one of the most business-friendly countries in Europe.
- Croatia: The Croatian government offers incentives for foreigners to open businesses in the country.
- Denmark: Private company owners in Denmark don’t have to be EU residents, but public company directors must be.
- Finland: It costs around €20,000 on average to register a business in Finland. Once operating, your entitle will pay a corporate tax rate of 20%.
- France: The business registration process is simple, provided all of France’s legal requirements are met.
- Gibraltar: This British Overseas Territory on Spain’s south coast is famous for its favorable tax system. Company profits are taxed at just 10%, but there are many business compliance regulations to follow.
- Hungary: Another business-friendly country, Hungary’s corporate income tax sits at 10% up to €1.8 million and 19% for all profits above that threshold.
- Isle of Man: The corporate income tax rate in the Isle of Man is currently 0% for most types of companies. Businesses may also be required to pay VAT (value-added tax) or payroll tax.
- Italy: There are no restrictions on foreign ownership of companies in Italy, but the registration process is complex.
- Jersey: Jersey is not officially part of the EU, but it has a special relationship and free trade of goods is permitted. Corporate tax is 0%.
- Luxembourg: Although it’s easy to set up a business in Luxembourg, there’s a hefty corporate tax of 24.94%.
- Malta: Corporate tax can be as low as 5% with generous tax exemptions.
- Norway: If the director or shareholder of a company is not an EU citizen, then 50% of the board members have to be residents of Norway. Corporate tax is 22%.
- Poland: There are no restrictions on foreign shareholding and corporate tax is 19%.
- Portugal: The easy access to shipping routes and the rest of Europe make Portugal a great business location. However, corporate tax is set at 31.5%.
- Romania: You only need €60 capital investment to register a business and you can have up to 50 shareholders. At 16%, the corporate tax rate is reasonable.
- Russia: The Civil Code covers Russian business activity and allows foreigners to form various types of companies. Corporate tax is 20%.
- Slovakia: A flat 21% rate of corporate tax and 0% tax on dividends make Slovakia an appealing option.
- Slovenia: Each investor must pay 25% of the total amount of capital they intend to contribute before registration. Corporate tax is 19%.
- Sweden: Sweden is third in the world on the World Bank’s list of connections with international markets. The corporate tax rate is 20.6%.
- Switzerland: Corporate tax in Switzerland ranges from 11.9% to 21%, depending on the business is located and how much profit it makes, among other factors.
- Turkey: Businesses that want to incorporate in Turkey must have a minimum of five shareholders and at least €24,000 start-up capital.
Company Types and Requirements in Different European Countries
Once you know which country you’d like to register your business, you’ll need to choose the type of company you want to register. Here’s a summary of the different options in various European countries.
Company Types in Austria
Company Types in Belgium
Company Types in Bulgaria
Company Types in Cyprus
Company Types in Czech Republic
Company Types in Denmark
Company Types in Estonia
Company Types in Finland
Company Types in France
Company Types in Germany
Company Types in Greece
Company Types in Hungary
Company Types in Ireland
Company Types in Italy
Company Types in Latvia
Company Types in Lithuania
Company Types in Luxembourg
Company Types in Malta
Company Types in Netherlands
Company Types in Norway
Company Types in Poland
Company Types in Portugal
Company Types in Romania
Company Types in Slovenia
Company Types in Spain
Company Types in Sweden
Company Types in Switzerland
Company Types in Turkey
How to Register Your European Business Online
Many EU countries have online portals where you can submit your information and register your business. Here are some examples:
Mandatory Documents for Registering a Company in Europe
No matter what type of business you are registering or which European country you’re registering it in, there is certain documentation you will always need, including:
- Articles of association, formation, or incorporation
- An official business name
- An official business address
- Identifying information about the company owner(s)
How Much Does It Cost to Register a Business in Europe?
The cost of registering your business in Europe will depend on several factors, including the type of entity you choose to register, the country in which you choose to incorporate, and your share capital.
The costs of registering a business in Europe may include:
- Fees for registering with the relevant government agency, such as the chamber of commerce or trade registry
- Fees required to obtain any necessary licenses or permits
- Legal fees for drafting articles of association or other documents
- Notary fees for notarizing documents
- Accounting and tax consulting fees
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The Bottom Line: You Can Easily Register a Company in Europe
With so many considerations to take into account, choosing where to register your business in Europe can seem overwhelming. Following the steps set out in this guide will take the stress out of incorporating your company.
As soon as you know where your business is going to be operating, it’s important to ensure that your customers have the best possible payment experience.
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