Best country for incorporation as European citizen (online marketing/saas)

Discussions
#1

Hi,

I’m a Norwegian national living in Spain (for the last 4 years), and I have a Spanish incorporation (S.L. , limited company). The problem here is that business is very old fashioned and not very well adapted to a pure online business like we run. We own web properties, and buy Facebook/banner ad space and make money through affiliate marketing and lead gen.

I’ve been looking at Malta or Ireland. But not sure which one would be most beneficial. It’s not for the tax, but because of the business climate and bureaucracy. Also I don’t want to be tied to Spain.

As a EU citizen, which country would be the best pick?

Thanks!

#2

I have an SL in Spain, too. It is a pain.

I hear good things about Ireland for business.

I’m not an EU citizen, so it is much harder for me to move the company to another EU country. I’m envious of people who can move their business to Ireland, for the reasons you describe: a nicer business climate and reduced bureaucracy.

#3

Quick question

If you move the company but stay in Spain, how do you paid taxes and explain the money in your account? Do you need to became autonomo and invoice your own company?

Thanks

#4

Thanks. I’m also based in Barcelona, so the current political climate doesn’t exactly make it more future-proof to have a company here.

I’m looking at Ireland too, but see a lot of internet marketers and online businesses opt for Malta. I’m also not sure how it will be with VAT since we buy ads from Facebook and Google platforms, something I need to figure out. In Spain in have the EU VAT number, so I won’t be charged VAT. Ref:

Whether you’re charged value added tax (VAT) on your Facebook ad purchases will depend on whether you’re purchasing ads for business purposes and the country of your residence. The most common scenarios are described below:

You live in Ireland:
Your purchase of Facebook ads is made through our European Headquarters in Dublin, so if your business’s address is in Ireland, we’ll add VAT at the applicable Irish rate to the costs of your purchases of Facebook ads. You’ll be charged VAT regardless of whether you’re purchasing Facebook ads for business or personal purposes. Learn how to find VAT charges on your billing reports.

@conradomaggi

Getting the money back to Spain isn’t a problem. There’s nothing stopping you from making money abroad, but you have to declare it and tax has to be paid, and then there’s a whole new can of worms with where it should be paid … With EU it should be easier though, while if you go for 0-tax countries you will have problems.

Edit: Also this looks interesting, Leapin (sorry can’t post links …) – but since it’s 0-tax, would I have to tax it in Spain, even though they charge a 20% dividend tax, afaik they will not tax witheld profits.

#5

Four years ago we opened a company in Scotland in just a week. It’s basically a European offshore country, at least for non-EU citizens. Everything was incredibly easy to manage.

#6

If you have a company in Ireland, you pay VAT and can ask it back later from the tax office (if you are a company).
If you are in Spain, you don’t have to pay VAT to fb, but you have to declare VAT on your Spanish tax declaration and VAT is handled in Spain (called “reverse charge”).

#7

Before looking to much outside Spain, I’d look into how Spain is going to asses you as the owner of a foreign company. In the end, this might bring more hassle and transaction costs than running the company in Spain.

Interesting options to look at are:

  • a Scottish LP, a tax transparent kind of company. Easy to administer, and you can just pay tax in Spain if you don’t have business in the UK.
  • Estonia with its E-residency. There are accounting services available which run such a company for you cheaply. However you have to pay high tax in Estonia, and possibly also in Spain. Also declaration of company costs is quite limited compared to some other countries.
  • Going to Andorra: https://jaserodley.com/living-in-andorra/ . Big advantage: close to BCN. Disadvantage: not in EU.
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#8

I’m living in Latvia and we also use an LP in Scotland, works nicely. I’m managing everything remotely. In fact, in 2 years since I moved away from the UK to Latvia, I’ve never had any issues that couldn’t be solved remotely so far…

P.S. Mind, Scotland will soon stop being part of the EU, duh :(( We’ll probably keep using it, haven’t decided yet.

P.P.S. the Scots are changing things lately (adding more transparency etc, cause they hate the “offshore” reputation), but nothing that applies to “white hat” businesses, so don’t let the news scare you.

#9

If I can steer this conversation in a particular direction, how much do you pay your bookkeeper/accountant per year to file any necessary paperwork with the tax department on your behalf?

In Spain, for a “SL” company (akin to a GmbH in German, an Ltd in the UK, and a Pty Ltd in Australia, and I don’t know about other countries) with sometimes two, sometimes three employees including myself, I pay roughly €3,000/year.

#10

I would assess this as a global optimization problem, that is out of all the money that comes in worldwide how to maximize what ends up in your pocket. Given the amount of parameters involved it is next to impossible to solve :slight_smile:

in general I don’t think you will save much unless you move to the country that offers lower taxes. Otherwise you get a lot of overhead with virtual companies, trustees, all of which cost money. And your tax people will need some convincing not to re-tax you when you move the money from the tax haven to your own country

if you are a 1-man company it is simpler because you could move countries relatively “easily”. I chose Cyprus and I am really happy, both for taxes and the general family living altogether

closer to Spain I heard that the canary islands are sort of the equivalent tax paradise, and not bad to live there I suppose!

PS. first post here, I am the author of xplorer2

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#11

Thanks all. I’m a one-man band, and I doubt I will stay in Spain “forever”. Even then I can very easily jump countries (legally) and stay here for a few months of the year.

@SteveMcLeod I pay around 200 per month for book keeping, accounting, Spanish/EU VAT and yearly filings (“Everything”) and includes any questions or advice I need. This also includes running my salary and filing the social security for me. I have a really good accountant central in Barcelona that I’ve been using for the last few years, and I can highly recommend them. Feel free to PM me if you need their contact.

This is slightly lower than what I’d expect to pay for something abroad, but at the same time Spain are very strict with accounting, and for an online business there’s a lot of hoops to jump, such as social security costs.

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#12

I am paying 300€ per month and another 1000€ for the annual statement, so that is roughly 5000€ for a german GmbH handling around 200-300 receipts per month. The employee count isn’t the cost, it is actually just 9€/month for handling one employee, the monthly VAT report is what costs.

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