How to move your business abroad
If you’re considering the move, here are some things to think about before making the leap.
The most important decision you will have to make is where you will move your business to. There are varying laws and regulations that will affect every business differently from country to country – it’s probably wise to seek expert advice in this regard. You’ll also need to do some market research to discover whether there is an appetite for your service or product wherever you choose.
Territories and countries such as Hong Kong or Singapore offer thriving business environments along with added tax benefits. On the other hand, relocating within the EU means you can continue to take advantage of the single market and the benefits that come with it. Ultimately, you must decide on whichever country or territory presents the best opportunity for your business in both the short and long term.
2. Managing finances
Apart from the initial cost – and that will likely be substantial – there is the matter of managing your finances once you arrive in your chosen location. It’s probably a good idea to keep your UK bank account open, but you will also need to open an offshore bank account (in some countries an active domestic bank account is a requirement to incorporate your company there).
Another aspect of managing finances that you may not have encountered before is foreign exchange. From moving your company’s cash into your new offshore account, to repatriating funds back into your home currency, you’ll want to do so quickly, efficiently and at as low a cost as possible. This is where the freemarket platform can help – we use technology to aggregate customers’ requirements and achieve the best rate for all involved, at a fixed fee of 0.2%.
So, you’ve done your calculations and market research, and decided that moving abroad is definitely the right decision for your business. It’s important at this stage to find a reputable offshore company formation agent to incorporate your company. Finding a good agent will simplify and hasten the process significantly – it might be possible to incorporate your company within a few days (with the correct documentation of course).
In the best-case scenario, you will have an agent who also has a professional partnership with chartered accountants who are experts in tax and legal requirements for the country or territory you are relocating to. Which brings us to our next point…
4. Tax and local regulations
We’ve already touched upon this, and while you may already have done plenty of research, this is still an area that catches many business owners out when moving abroad. No matter how meticulous you think you’ve been, there is always a small chance that you could make a mistake when it comes to local tax law. For example, opening an office abroad for longer than six months could make you liable for accounting requirements, including local tax returns. If you relocate to a country that requires this, you could end up paying penalties as well as interest from the deadline date if you miss it.
Ensuring you seek proper legal counsel both prior to and after moving is essential. If you aren’t sure on something or think you may have misunderstood, clarify it as soon as possible – it may save you a lot of stress (and money) down the line.
5. Understanding the culture
It may sound obvious, but moving your business to a country where English is not the spoken language could prove extremely difficult. Don’t make the mistake of assuming that English will be widely spoken, even by local professionals and businesses. If you already speak another language, you might choose to move to a country where that language is spoken, as this will make it far easier for you to hit the ground running when you arrive.
Equally, understanding the cultural nuances of how business is conducted will prove vital – is business done in a meeting room or over lunch? Should you invite your prospective customer or business partner for a pint, or keep things more formal?
Finally, if you yourself are also intending to relocate permanently with the business, is this somewhere you can see yourself living in the long term? Or potentially moving your family to? If yes, then it sounds like you’re onto a winner, if not, perhaps it’s time to reassess your options.
The decision to move your business abroad can seem daunting, but with thorough research and careful planning, the rewards can be huge.