Thinking about European company formation because BREXIT?
The UK’s transition period in which it still participates in the European Single Market expires by the end of 2020. After this deadline, we can expect a whole new world regarding economic changes. Moreover, the effect of Brexit on UK registered companies is still not known but will be seen in the long term. The question is if we can look at it as an opportunity or devastation?
Even when it comes to experts discussing the outcomes of the UK leaving the EU, there are many different points of view.
Whatever changes are, it is high time to consider company formation in the European Union as otherwise unlimited access to the common market and selling products and services free of VAT are to be closed off for UK enterprises.
Also an important issue we have to face is that after Brexit UK citizens will be left without freely travelling and working in the EU.
What solutions are for Brexit?
We think that you should consider moving your company to another country in the EU, if you still want to enjoy the benefits of being part of the European Union. So don’t let everything be lost with the UK leaving the EU, and think about European company formation.
Where is it worth to set up a company in the EU after Brexit? First of all, let’s have a look at France or Spain. They seem to be good targets to start a business, though corporate taxes are relatively high with 28 % in France and with 25% in Spain. It might be more favourable to go into business in Ireland, as the 12,5% corporate income tax (CIT) is considered favourable.
Is low corporate tax important? Why not move your company to Hungary?
Think of a Hungarian company formation as the ideal solution for Brexit! Why do we recommend Hungary? We would like to draw your attention to the fact that in Hungary the tax system is very favourable for companies and the corporate tax rate is only 9% which is the lowest in the European Union. According to an OECD study, corporate income taxes might hurt the growth of the economy, thus lower corporate taxes can have a favourable influence on economic growth. The Hungarian Government set the aim to create a stimulating business environment and lowered corporate taxes in several steps.
Due to this process, the corporate tax has been a 9% flat rate since 2017 in Hungary. Isn’t it a favourable location to set up a company?
Final thoughts about life after Brexit
Right now we’re just entering the new era where the UK does not belong to the EU. Nobody knows what the real effects of Brexit on UK companies will be, but we suggest that you come up with a plan with different European company formation solutions and that you definitely should consider Hungary for this purpose.
Should you have any questions or further information required, please contact us and we’ll be happy to offer you our expertise.