Ask HN: Is forming a company in UK a good option for a non-US resident

What's wrong with having a local company (hence subject to laws in your jurisdiction) and then having a bank account in another country with friendlier banking facilities?

If this is a new business it's not usually worth the administrative overhead unless incorporating in the UK or US solves a specific issue (like stripe support, or some other critical services you made need).

You could consider http://stripe.com/atlas

In UK are very stricts with all the paper work, if you don't do something right you will receive a fine (and not a small one regardless of what you missed). There are companies with manage this type of things and deal with all the paperwork. Just search for how to open a company in Uk. Some of them also helps with opening the bank account.

For me the worst thing about a Europe company is to deal with taxes when you sell to European countries. By lay you have to charge the tax where your client is, it means you have to be aware of where is your client located and the taxes in that country, plus fill all the paper work related. Keep this in mind as it can be worth for you to open the company in your country just to avoid this kind of things.

- deleted comment about US company... - Regarding UK limited... there are special service companies which assist you in creating one, also helping you with taxes etc. But I don't know how this works for non EU residents.

You're perhaps better asking an accountant in the UK, rather than a lawyer.

It costs ~£15 to start a limited company in England and Wales (a separate jurisdiction to Scotland and Northern Ireland). So long as you keep accurate records and file your annual accounts correctly, that's all there is. An accountant would normally do the filing for you. For a small business this can often be done for £500-£1000. If you do your own bookkeeping and keep accurate records, that will keep costs down.

As your business will be domiciled in the UK, it will be subject to the UK's tax regime. But if you're outside the UK, your salary from the business shouldn't be subject to UK taxation (do check that, though - double-taxation isn't something I know much about).

TL;DR - Find an accountant in the UK who'll be willing to give you a free consultation (most of them). You'll probably find one on ukbusinessforums.co.uk (it's where I found mine).

Singapore and Estonia both seem to be doing things right. Singapore (unlike Estonia) also has a fairly long tradition of being a great place for foreigners to incorporate, a well established and stable legal regime, sane taxation, etc. Estonia also looks pretty good, but they haven't been around as long so the odds of them making trouble for you in the future are probably higher than Singapore.

A Singapore corp will require you to pay taxes once on corporate income. After that it's simple - make distributions to yourself and pay only local taxes. It's as if Singapore asked economists what the most efficient way to run a society is and then actually did that.

A US business entity is probably a very bad idea due to things like taxation on global income and just general US insanity.

Check out Stripe Atlas. http://www.wired.com/2016/02/stripe-gets-business-making-bus...

From my point of view, you should consider first where are your customers, and then -assuming you'd like to- where you'd like to look for fundings.

If you plan to market US companies and potentially raise money in the US, then you should incorporate in the US. You don't need to live there, although I'd recommend for alignment with your customers' time and build connections to raise. After initial expenses (i.e. the company is alive and running) it's relatively easy to get a visa.

If you're serious about your biz, you should take any decision to maximize its success, not to save a few bucks at the beginning.

Take a loot at Atlas, by Stripe: https://stripe.com/atlas

Why not the Cayman Islands? I was involved years ago in a 'distributed company' (US, Colombia, Brazil) that was offering a service to the Portuguese-speaking world (Brazil, Portugal) and we were registered in the Caymans.

Things worked out pretty well and the only trouble I had relative to the administration was that my name was on some paperwork that went to vendors and I'd sometimes get calls from vendors who would ask "Is this some kind of scam?" and then I would rattle off a list of well-known names that have important subsidiaries in the Caymans.

Luxembourg seems to be the flag of convenience for the EU, just as Delaware is here in the US, although Delaware puts you smack dab in the middle of FATCA land.

If I was setting up a SaaS company outside of the US, I'd be concerned with tax rates, acquiring a bank account and processing credit cards.

It is worth noting that you don't necessarily have to have your bank account in the same jurisdiction that the company is incorporated.

There are many zero tax offshore jurisdictions (like BVI and Cayman Islands) and at a large scale you can get bank accounts and process credit cards anywhere. But, starting from zero I think it's a lot easier to use Stripe or Braintree.

I've listed several jurisdictions that are compatible with Stripe and Braintree by corporate tax rates. You may be able to achieve a lower rate by paying yourself a salary.

Stripe & Braintree

  Ireland (12.5%)
  Singapore (17%)
  United States (~35%)
  United Kingdom (~20%)

Braintree

  Lichtenstein (12.5%)
  Isle of Man (0%)
  Jersey (0%)
  Guernsey (0%)

So, I would consider Ireland and the above Crown dependencies.

Sources: https://www.braintreepayments.com/country-selection https://stripe.com/global

No experience with UK specifically, but being in the same position as you are (Eastern Europe, problems working with payment providers because of both their unwillingness and stupid local laws) I want to give you a warning. Do check your domestic laws on corporate tax residence. A lot of countries (e.g. Russia as of lately) will want to tax your company simply based on the residency of the physical person(s) managing the company (you in this case). So make sure you don't end up owing taxes in both jurisdictions. And even if your country has a treaty on double taxation with e.g. the UK the procedure to apply for an exemption may be really gruesome.

Running a company in the UK is super easy compared to some eastern european countries - far less bureaucracy, regulations (maybe apart from VAT-MOSS, but that's an EU thing) are easy to follow and most things can be done online. An accountant can do a lot of this for you and they cost between £60-120 a month. You will have to show up in person for an appointment to open a bank account though, and UK banks, generally - suck.

In terms of taxation, CIT/VAT are similar to everywhere else in Europe, PIT depends on where you live, so you need to talk to an accountant in your home country.

Hey - I just recently wrote a series of blog posts of creating a startup in the US and UK for developers. It's based on my experiences. If you're based in Europe being a UK based limited company is a great option. As others have said you'll need a good accountant and lawyer, the posts cover my experiences with various companies. Personally I'd recommend Crunch.co.uk for helping with the company formation and accounts. Then Lawbite for the legal side of things. They've answered a bunch of my questions.

One big thing to beware of is VAT and VAT MOSS scheme - it's a bit of a nightmare to figure out your way around that. After discussing with accounts and lawyers your best option is to not be VAT registered until you know you're going to exceed the £82k threshold. Again - speak with your own lawyer and accountants on this as everyone's situation is different.

Hope that helps!

TL;DR - https://news.ycombinator.com/item?id=11360598 - Covers company formation (and recommends a couple of accountancy options for the UK)

- https://news.ycombinator.com/item?id=11360651 - Covers Legal advice for US and UK startups.

If you're looking to do business outside the EU as well (and not have to handle VAT-MOSS), you might want to read the Ghost blog on why they decided to move their foundation from UK to Singapore: https://blog.ghost.org/moving-to-singapore/

(The HN discussion of the above link: https://news.ycombinator.com/item?id=11103274)

Are you familiar with Stripe Atlas?

It was built for this usecase, and allows non-US companies to:

- Get US Bank Account at SVB

- Incorporate as Delaware C corp

- Accept Payments immeadiately using stripe

- have access to PWC consultants about tax and accounting info

- AWS credit

It is in beta, but they are accepting applications. You should give it a go if it makes sense

One thing to bear in mind is that the UK is having a referendum on continuing its EU membership on Thursday 23 June. While I sincerely hope we stay in the EU, it's not 100 % clear that we will (although it seems likely). I know hardly anything about doing business outside the UK but within the EU, but it might be worth looking into what the change in situation would be if the UK did leave (such as changes in the need to charge the client's country's tax rate, rather than the company's country's tax rate).

I've got a Delaware LLC and the tax is pretty simple - you just fill in a form (w8-ben) to say you are non US resident and that's it for US tax. Whatever income and gains are regarded as being yours personally and you are supposed to declare them where you live.

For the UK there's some info here on getting bank accounts (2013) https://www.rapidformations.co.uk/blog/business-bank-account... I'd recommend phoning them / the banks for the current situation.