It’s challenging to find a better place to start a business than the European Union. It’s one of the most absorbent markets in the world, with a huge and diverse customer base and international trade agreements with most countries in the world.
What to Know About Starting a Company in the EU
On top of that, European countries are well-known for their fantastic approach to new companies. In the 2020 edition of the Ease of Doing Business Report by World Bank, among the top 30 countries, 15 of them were European (including non-EU countries like Norway or the United Kingdom).
Of course, it doesn’t mean that establishing a new venture in Europe is a piece of cake. On the contrary, it can be a long and laborious journey, especially if you aren’t familiar with all the EU rules and regulations. To help you with that, we’ve prepared the following guide.
Below, you’ll find everything you need to know about becoming a European entrepreneur, including the best EU countries to set up or expand your business, registration processes, and GDPR consulting.
Read on to discover how you can take advantage of this fantastic economic market and make all your business dreams come true:
Best European Countries to Start a Business
Let’s begin by looking at the top European Union countries for new entrepreneurs. At this point, we assume you already have your dream business idea and general plan on how you wish your venture to look.
That’s why in this section, we’ll focus on economic indicators that make the following countries the best locations for your startup.
Estonia might not be the first EU country that comes to mind when you think about starting a company.
However, this small country offers many investment opportunities. It’s known for its top-quality educational system, and its startup’s per capita rate is one of the highest in Europe.
On top of that, the Estonian government has an entrepreneur-friendly tax policy. All that makes it one of the world’s most exciting locations for starting a business.
Another country worth your attention in Sweden. Yes, the house of IKEA is also a fantastic place to set up a business. Sure, in the past, this Scandinavian nation wasn’t the most attractive location for new investors.
However, plenty has changed in the last few years. The ongoing digitization has revolutionized the whole tax and registration system. With government plans to reduce the corporate tax, Sweden is becoming one of the locations in Europe for emerging businesses.
Did you know that Denmark is ranked as the best country worldwide for trading across borders? No? Then now you know why it’s worth considering it as the location for your European business.
That’s not the only reason, though. Denmark is known for its great taxation system and straightforward business registration process. In other words, if you’re looking for a great European country for your company, choosing Denmark is probably the best call to make.
Requirements for Starting a Business in Europe
When it comes to requirements one needs to meet to start a business in Europe, they will vary depending on two factors – the country and type of company. Of course, the European Union wants member countries to meet specific standards. It doesn’t impose anything, though.
Still, there’s one barrier you will have to consider when entering any part of the European market – obtaining a residency permit. Of course, it’s not a problem if you’re a citizen of an EU country.
However, for non-EU residents, starting new businesses can be challenging. Again, it all depends on the country, so make sure you read carefully the requirements governments impose on non-EU entrepreneurs.
Taxation and Legislation in the EU
When it comes to taxation and legislation, we want to clarify two things – VAT and GDPR. Let’s start with the first one:
Value Added Tax (VAT) is a consumption tax applied to nearly all goods and services bought and sold in the EU. The EU has some standard rules regarding VAT, but each country can apply them differently.
Generally, one has to pay VAT for all goods and services throughout all supply chain stages. In other words, every transaction your EU-based company makes involves VAT payments. You can check the rates of individual countries on the official EU site.
General Data Protection Regulation, otherwise known simply as GDPR, regulates the data flow across the EU region. It means that European citizens now have more control over their personal information and assurances that companies protect their data.
In a nutshell, you have to ensure top-quality data protection in your business. Otherwise, you might get fined up to 4% of your global annual revenue of 20 million Euros (whichever is greater).
Financing Your New Business
You won’t achieve anything without money. Fortunately, when it comes to starting a business in Europe, you can count on access to financial support from the EU. Each private venture can apply for one of many EU funding programs and business loans.
Of course, you will have to meet some requirements. However, you shouldn’t find it too troublesome to benefit from the EU help with the right business idea, growth plan, and financial plan.
Again, it could all depend on the country you want to start your company. Some countries have many venture capital and loans supported by the EU, whereas others aren’t too keen to invite new companies.
We recommend visiting the official EU website, as it provides all the information required to start your operation.
Starting a venture in Europe requires a lot of effort and knowledge. One has to consider everything, starting from choosing the best country to understanding how paying taxes in the EU works and how to register a new company.
Hopefully, after reading this short guide, you get a general idea about entering the European market. For any further questions, we recommend contacting the EU officials. They will provide you with more detailed information and help you through the whole registration process.