How to incorporate software startup from Poland or some other country?
I have problem, I live in Poland and I want to incorporate my software startup that makes around $15k/year. The cost of incorporation of a limited company in Poland is $7k/year (w/out taxes). This is too much for my startup to not slow down this project growing speed but without incorporation I will be running the business illegally, which will be a barrier to developing the business.
Where I can incorporate? I know that foreign incorporation has additional costs if there's no presence in that country, but I think that can be cheaper than in Poland.
Can someone advise me something from personal experience based on concrete information about costs, country and experience (can be not from Poland)?
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I know that European business licenses are relatively expensive but $7k/year sounds like way too much. Are you sure you have the right information? – Dnbrv 12 years ago
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Let's add to the answers the Delaware LLC and you have a complete set. – Karlson 12 years ago
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@dnbrv: yes this is true information's, because I running limited company in Poland and this is real values, 4,5$ per year is lowest accounting costs in Poland for that, rest of costs is registration fees in court and lawyer costs. – Svisstack 12 years ago
3 Answers
Try a british ltd.
They are pretty inexpensive and as it's the EU there's not many problems for you to register one. Google should help.
I think that the easiest solution could be register Ltd. in UK. All formalities could be done via Internet from Poland. You can save much money on the accounting services (cheaper in the UK) and taxes.
Additional profit is possibility to join UK's insurance system.
If you speak some German, I'd recommend looking into the Unternehmergesellschaft (haftungsbeschränkt) since you're very close by and can easily come over to do things like open a bank account in person. The tax scenario is very similar to the Ltd and it is also just a matter of a few hundred Euros to incorporate a UG.
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The UG (and Gmbh for that matter) are administrative nightmares. Also the Germans have something called "Geschaeftsfuehrer Durchgriffshaftung" - pretty long word - which means: The CEO can (and usually will) get in legal troubles if the company goes bust. With the German system there are many legal (many of them penal) traps you can step into. Also getting a bank account with a UG will be hard. Most banks don't like UGs (which are suspiciously seen as insolvent "mini-Gmbhs") as customers. A british Ltd. is by far less trouble. – Jsz 11 years ago
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To give some counterbalance to this, I haven't found administrating a UG to be an administrative nightmare (I can't think of anything that I have to file on behalf of the company that is unusual or unusually complex), nor was it difficult to get a bank account or merchant account. – Halle 11 years ago
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Durchgriffshaltung, or piercing the corporate veil (also a long phrase), is something to research and take into consideration for every country that offers a low-barrier-to-entry corporate form, including the UK and the US. It is always possible to lose the limitation of liability under certain circumstances and the circumstances tend to be similar and not trivial. It's true that it is less common that UK courts rule that the corporate veil has been pierced than US or German courts, but I do think it's a stretch to suggest that Germany is something other than corporation-friendly. – Halle 11 years ago
