June 6, 2019 at 09:54How we registered a company in the EU
The need to register a company in the EU arose immediately after the need to purchase our own equipment to realize some of the opportunities that we could not offer on a rental basis. And no matter how we would like to wave an advertising banner in front of our dear readers and tell us how much we can do now (for example, route your subnets, combine equipment into private networks, accept payment to the account and give beautiful closing documents for bookkeeping with stamps), that's all in the post I will focus on the issues of transferring a business or opening a unit in the EU. And the buns that we can now offer, I will leave in the end.
So, welcome to Ventspils High Technology Park.
Initially, HostingManager (Sergey in the world) considered all 3 Baltic countries according to the recommendations of friends. I applied to recommended companies in Lithuania and Estonia, I advised in Latvia. Problem statement: company registration, opening a bank account and obtaining a VAT payer number (value added tax, aka VAT). Naturally, the helpers insisted that only their solution was reliable, and all other options were either pain and suffering, or lies and swindle. What reminded me of one rule known among emigrants from post-Soviet countries: stay in exile far from former compatriots, they will be the first to try to cheat you. So, a little myth making with comments.
There was an offer to purchase a ready-made company with everything necessary, which simply ceased operations and made a full settlement of obligations. It’s really faster, but still I didn’t really want to.
I can’t say anything about the nuances of paragraphs 1 and 2 in Lithuania, but in the jurisdictions known to me, the authorized capital can be immediately used for business activities and is not stored in any special accounts.
Point 4 - it may well be. At the time of writing the article in the Doing Business ranking on the “start a business” parameter, Estonia is in 15th place, Latvia is 24th, Lithuania is 31th.
Next, we talked about taxes. I said that in Latvia there is essentially no corporate income tax; it has been replaced by a dividend distribution tax. A wave of indignation began.
Please commentthe link to the Latvian tax department was left unanswered. Although we in some sense to talk about the same ( "tax-exempt reinvestment" does not differ in essence from what I said), I was accused of " about bsolyutno not professional advice." Honestly, I never possessed professionalism in the sale of waste.
Here the conversation was originally about registration, as well as comparison with Latvia.
Talk about the instability of the banking system, it seems to me, comes from the sensational news about the liquidation of one of the largest banks in the country. Few people mention that the bank did not go bankrupt and was quite profitable. And they decided to close it for some gray activity that the regulators did not like. Although certain inconveniences were created, the money did not go into the pipe.
As for the opening of accounts for non-residents ... If a company registered in conditional Antarctica (so as not to offend any country here) would open an account in Estonia, it would be a non-resident. A company registered in Estonia with conditional Antarctica will be a resident with a non-resident founder. And this, as they say in Odessa, is still two big differences. And, although more attention is paid to companies with non-resident founders, additional verification and all that, they still open accounts for them (although not for everyone).
I really like the wording "not a huge minus, but a minus." PayPal already examined us under a microscope (more on that later). Knowing their scrupulousness, I would not really like to explain why they did not even open an account in the country of registration.
Accounts, with rare exceptions, are opened everywhere in countries with strict control in person. And about the collapse of the banking system of Latvia in general, only one Russian-language publication knows for some reason, if you look at the news.
If the company conducts transparent and understandable activities, an account can be opened in Estonia. Moreover, the company registered there is still a resident. Yes, it may be necessary to go throughanal sounding with a meticulous interview with a bank representative. And without guarantees. But why be so categorical?
Registering a company in Estonia using an e-Residency card takes 1 day, by the way, so I dare to assume that the rest is reserved for games with the bank.
As for the VAT number, companies with a turnover of more than 40 thousand euros can not only, but are required to receive it. And everyone can be served (justification may be required for companies with lower turnover).
Finally, the rates.
My jaw personally fell off a bit, of course. Perhaps it's time to tie up with programming and start helping to open companies in the EU.
No myths. Company registration 1-3 business days. Opening an account from "on the same day" to a month, depending on the bank. Getting a VAT number about a week. Real prices for services in the city of Ventspils where I live:
In Riga, some items will be more expensive, of course. On top of this, you can add an arbitrary amount for "I know where to go, but you do not."
The most common form of registration in Latvia, as in many other countries, is a limited liability company, which is called SIA here. They are of two types: ordinary (with registered capital from 2800 euros) and with reduced capital (from 1 to 2799 euros). The second option is subject to a number of restrictions on the number and composition of participants, but there is one plus - there is no need to submit a certificate from the bank about the payment of the authorized capital when registering. With a registered capital of EUR 2,800, at least half must be paid into a temporary account before applying for registration (after registration this account will become permanent).
Accordingly, the first thing we needed was to open an account. And then the first stresses began. We were guided by incorrect information that a temporary account is opened in any case immediately. It turned out that the consideration of documents is carried out precisely at this stage, and the period announced to us varied from 3 days to a month depending on the bank. We saisaged almost all the banks whose branches were in Ventspils. Already thought, it was, to correct documents and register a company with reduced capital (in this case, a certificate of payment is not required).
And in one, essentially the last on our route, luck smiled at us. We asked to open just a temporary account for the authorized capital, but the bank was not interested. But getting us in the end as a regular customer is another matter. In addition, six months of free maintenance. How could one disagree here? .. The head of the department wrote in charge of Riga and said that now she would return from lunch and do a check. While we were eating junk food nearby, they called us back and said that everything was in order, the documents were ready for signing. And they didn’t even take a fee for reviewing documents (for companies with non-resident founders in other banks they charge 50-200 euros). I will not deliberately publicly disclose what kind of bank it is. However, soon the certificate of payment of the authorized capital was in our pocket.
There are many options. You can ask friends to give permission to register with them at home, you can rent an office or use the services of a legal address. Here you need to be thoughtful and accurate: companies registered at well-known mass registration addresses canattract the attention of orderlies to arouse increased interest of the tax service. The best option is a real office building, which also has a legal address service. In any case, if this is not a property that belongs to you, you should have permission from the owner to use the premises as a legal address before registration.
If you understand Latvian at least at the level of B1-B2, you can download samples of the necessary documents and enter your data in them (company name, registered capital, your data, etc.). If you do not understand or do not want to bother, for 30-60 euros local will do it for you. If you need some improvements, it is better to contact a lawyer, and it will cost from 100 euros.
The minimum required set of statutory documents includes:
If you are not local (you do not have a residence permit or passport), these documents will need to be certified by a notary. Do not expect a notary public to be bored and waiting for you. It is better to arrange an appointment time in advance.
You may also need permission to use a legal address and a certificate from the bank, which I mentioned above. I remind you that permission is needed if the premises do not belong to you, and a certificate is required if a company with an authorized capital of 2800 euros or more is registered.
If you are again not local, you will need to personally come to the office of the Register of Enterprises to submit documents. Locals can create, sign and file all documents electronically. Because of this, offices receive customers very little time per week, this must be taken into account. At the time of company registration by us in Ventspils, they took 4 days for half a day. Now reduced to 2 days. In advance or at the office you will need to fill out the registration form and pay the registration fee with a card. Yes, state authorities here calmly accept cards, you do not need to run to the nearest bank and carry atoilet piece of paper. Get envious.
Registration usually takes 3 business days. But if the founder is one, you can write a piece of paper on the spot with a request to register within one. Naturally, in Latvian. As a result, Sergey had the pleasure of writing this very statement under dictation and with absolutely no understanding of which demon he would call with these letters on a leaf.
So, we started the epic on Monday, and by Wednesday evening we had a confirmation of registration on hand. It's time to apply for a VAT number. Our accountant helped us with this, because I don’t know the details of the application. I only know that she called a couple of times, coped with the situation.
At the beginning of next week, Sergey was invited to an interview at the local tax (VID) to fill out a kilometer-long questionnaire. I and the accountant were there as a support group and sometimes translators. The inspector, who asked questions and filled out the questionnaire, tactfully and with understanding reacted to a very limited (in the sum of three of us) knowledge of Latvian and simply did her job in a quality manner. In short, the tax authorities were interested in what we plan to do in Latvia and the EU, and why we need a VAT number. As soon as we were waiting for an invoice for the purchase of equipment worth more than 40,000 euros, our evidence was quite convincing. By the end of the second week, the company was completely ready for work. The time has come to gradually transfer operations and the system to a new mode of operation.
Here, too, the work has taken over. It was necessary to make various improvements on the site and in billing, to take advantage of the opportunities that had opened (to connect new payment systems, for example). But first things first.
Work in the EU and within the framework of the EU legislation obliges to establish order and comply with local requirements. I had to do what was forgotten for quite some time. I had to carefully and thoughtfully go over the following points:
In fairness, it is worth noting that the integrations themselves were written. But I had to tinker with all sorts of pieces of paper to connect. So, the list of payment methods was replenished:
And the plus is the ePayments payment module, I had to write my own code. We will try to release soon.
And I also had to write a more boring integration - uploading all the payment data for a new company to the accounting system. And some more boring, but necessary little things.
Some of our European customers were not happy with this item. A couple of people even changed their addresses to those that are not from the EU. But be that as it may, since we have received a VAT number, collect it within the European Union and the European Economic Area.
By the way, a few words about VAT in Europe. Rates are governed by the national laws of each country. The minimum permitted standard rate is 15%. The actual standard rates used range from 17% in Luxembourg to 27% in Hungary. The most common rates are 20-21%. In Latvia - 21%. In each country for certain groups of goods and services there are reduced rates, but we do not fall into this category.
Well and how not to advertise. Before I begin, I want to say thank you, dear, but not fond of advertising, reader, for reading up to these lines. If you have any questions, I will be glad to answer here either in PM.
Well, let's go for new features. In brief, I announced them, now in a little more detail.
These features allowed us to offer new products:
In general, we have become more flexible for your convenience. Thank you for reading a minute of advertising, and welcome to the updated UA-Hosting.
So, welcome to Ventspils High Technology Park.
The choice of location and myth-making "help"
Initially, HostingManager (Sergey in the world) considered all 3 Baltic countries according to the recommendations of friends. I applied to recommended companies in Lithuania and Estonia, I advised in Latvia. Problem statement: company registration, opening a bank account and obtaining a VAT payer number (value added tax, aka VAT). Naturally, the helpers insisted that only their solution was reliable, and all other options were either pain and suffering, or lies and swindle. What reminded me of one rule known among emigrants from post-Soviet countries: stay in exile far from former compatriots, they will be the first to try to cheat you. So, a little myth making with comments.
From Lithuania
There was an offer to purchase a ready-made company with everything necessary, which simply ceased operations and made a full settlement of obligations. It’s really faster, but still I didn’t really want to.
I can’t say anything about the nuances of paragraphs 1 and 2 in Lithuania, but in the jurisdictions known to me, the authorized capital can be immediately used for business activities and is not stored in any special accounts.
Point 4 - it may well be. At the time of writing the article in the Doing Business ranking on the “start a business” parameter, Estonia is in 15th place, Latvia is 24th, Lithuania is 31th.
Next, we talked about taxes. I said that in Latvia there is essentially no corporate income tax; it has been replaced by a dividend distribution tax. A wave of indignation began.
Please commentthe link to the Latvian tax department was left unanswered. Although we in some sense to talk about the same ( "tax-exempt reinvestment" does not differ in essence from what I said), I was accused of " about bsolyutno not professional advice." Honestly, I never possessed professionalism in the sale of waste.
From Estonia
Here the conversation was originally about registration, as well as comparison with Latvia.
Talk about the instability of the banking system, it seems to me, comes from the sensational news about the liquidation of one of the largest banks in the country. Few people mention that the bank did not go bankrupt and was quite profitable. And they decided to close it for some gray activity that the regulators did not like. Although certain inconveniences were created, the money did not go into the pipe.
As for the opening of accounts for non-residents ... If a company registered in conditional Antarctica (so as not to offend any country here) would open an account in Estonia, it would be a non-resident. A company registered in Estonia with conditional Antarctica will be a resident with a non-resident founder. And this, as they say in Odessa, is still two big differences. And, although more attention is paid to companies with non-resident founders, additional verification and all that, they still open accounts for them (although not for everyone).
I really like the wording "not a huge minus, but a minus." PayPal already examined us under a microscope (more on that later). Knowing their scrupulousness, I would not really like to explain why they did not even open an account in the country of registration.
Accounts, with rare exceptions, are opened everywhere in countries with strict control in person. And about the collapse of the banking system of Latvia in general, only one Russian-language publication knows for some reason, if you look at the news.
If the company conducts transparent and understandable activities, an account can be opened in Estonia. Moreover, the company registered there is still a resident. Yes, it may be necessary to go through
Registering a company in Estonia using an e-Residency card takes 1 day, by the way, so I dare to assume that the rest is reserved for games with the bank.
As for the VAT number, companies with a turnover of more than 40 thousand euros can not only, but are required to receive it. And everyone can be served (justification may be required for companies with lower turnover).
Finally, the rates.
My jaw personally fell off a bit, of course. Perhaps it's time to tie up with programming and start helping to open companies in the EU.
From Latvia
No myths. Company registration 1-3 business days. Opening an account from "on the same day" to a month, depending on the bank. Getting a VAT number about a week. Real prices for services in the city of Ventspils where I live:
- preparation of documents for registration - 30-60 euros, if you do not need to add something special to the charter, and the standard minimum option is suitable. Envy, immigrants from especially bureaucratic countries: the minimum required charter for an LLC in Latvia consists of 3 points, each 1-2 paragraph in size. The template can be downloaded directly on the state website and fill in your data (company name, size of the registered capital and some other little things);
- certification of documents by a notary (necessary if the founder does not have a residence permit or a Latvian passport) - about 100 euros;
- registration fee depends on the type of company, for a standard LLC - a little less than 200 euros;
- opening a bank account - 0-200 euros (more on that below; it’s worth mentioning here that if someone offers you a “guaranteed account opening” - they are lying impudently);
- getting a VAT number (here it is called PVN) is free in itself, but you need a local accountant to help fill out the paperwork;
- legal address - about 20 euros per month (a little less if you are a payer of PVN), office rental - about 5 euros per square meter plus PVN;
- accounting services depend on the number of transactions, from 25 euros per month.
In Riga, some items will be more expensive, of course. On top of this, you can add an arbitrary amount for "I know where to go, but you do not."
Registration form
The most common form of registration in Latvia, as in many other countries, is a limited liability company, which is called SIA here. They are of two types: ordinary (with registered capital from 2800 euros) and with reduced capital (from 1 to 2799 euros). The second option is subject to a number of restrictions on the number and composition of participants, but there is one plus - there is no need to submit a certificate from the bank about the payment of the authorized capital when registering. With a registered capital of EUR 2,800, at least half must be paid into a temporary account before applying for registration (after registration this account will become permanent).
Account opening
Accordingly, the first thing we needed was to open an account. And then the first stresses began. We were guided by incorrect information that a temporary account is opened in any case immediately. It turned out that the consideration of documents is carried out precisely at this stage, and the period announced to us varied from 3 days to a month depending on the bank. We saisaged almost all the banks whose branches were in Ventspils. Already thought, it was, to correct documents and register a company with reduced capital (in this case, a certificate of payment is not required).
And in one, essentially the last on our route, luck smiled at us. We asked to open just a temporary account for the authorized capital, but the bank was not interested. But getting us in the end as a regular customer is another matter. In addition, six months of free maintenance. How could one disagree here? .. The head of the department wrote in charge of Riga and said that now she would return from lunch and do a check. While we were eating junk food nearby, they called us back and said that everything was in order, the documents were ready for signing. And they didn’t even take a fee for reviewing documents (for companies with non-resident founders in other banks they charge 50-200 euros). I will not deliberately publicly disclose what kind of bank it is. However, soon the certificate of payment of the authorized capital was in our pocket.
Legal address
There are many options. You can ask friends to give permission to register with them at home, you can rent an office or use the services of a legal address. Here you need to be thoughtful and accurate: companies registered at well-known mass registration addresses can
Preparation of documents
If you understand Latvian at least at the level of B1-B2, you can download samples of the necessary documents and enter your data in them (company name, registered capital, your data, etc.). If you do not understand or do not want to bother, for 30-60 euros local will do it for you. If you need some improvements, it is better to contact a lawyer, and it will cost from 100 euros.
The minimum required set of statutory documents includes:
- charter;
- decision on the basis;
- distribution of shares.
If you are not local (you do not have a residence permit or passport), these documents will need to be certified by a notary. Do not expect a notary public to be bored and waiting for you. It is better to arrange an appointment time in advance.
You may also need permission to use a legal address and a certificate from the bank, which I mentioned above. I remind you that permission is needed if the premises do not belong to you, and a certificate is required if a company with an authorized capital of 2800 euros or more is registered.
Company registration
If you are again not local, you will need to personally come to the office of the Register of Enterprises to submit documents. Locals can create, sign and file all documents electronically. Because of this, offices receive customers very little time per week, this must be taken into account. At the time of company registration by us in Ventspils, they took 4 days for half a day. Now reduced to 2 days. In advance or at the office you will need to fill out the registration form and pay the registration fee with a card. Yes, state authorities here calmly accept cards, you do not need to run to the nearest bank and carry a
Registration usually takes 3 business days. But if the founder is one, you can write a piece of paper on the spot with a request to register within one. Naturally, in Latvian. As a result, Sergey had the pleasure of writing this very statement under dictation and with absolutely no understanding of which demon he would call with these letters on a leaf.
Getting a VAT number
So, we started the epic on Monday, and by Wednesday evening we had a confirmation of registration on hand. It's time to apply for a VAT number. Our accountant helped us with this, because I don’t know the details of the application. I only know that she called a couple of times, coped with the situation.
At the beginning of next week, Sergey was invited to an interview at the local tax (VID) to fill out a kilometer-long questionnaire. I and the accountant were there as a support group and sometimes translators. The inspector, who asked questions and filled out the questionnaire, tactfully and with understanding reacted to a very limited (in the sum of three of us) knowledge of Latvian and simply did her job in a quality manner. In short, the tax authorities were interested in what we plan to do in Latvia and the EU, and why we need a VAT number. As soon as we were waiting for an invoice for the purchase of equipment worth more than 40,000 euros, our evidence was quite convincing. By the end of the second week, the company was completely ready for work. The time has come to gradually transfer operations and the system to a new mode of operation.
System preparation
Here, too, the work has taken over. It was necessary to make various improvements on the site and in billing, to take advantage of the opportunities that had opened (to connect new payment systems, for example). But first things first.
Legal revisions
Work in the EU and within the framework of the EU legislation obliges to establish order and comply with local requirements. I had to do what was forgotten for quite some time. I had to carefully and thoughtfully go over the following points:
- Cookie notification. How did we live without him? .. Well, I had to add.
- Change some billing settings so as not to be substituted for GDPR. Although I wrote an article about GDPR a year ago , still there were a couple of flags in billing that were worth adding or removing.
- Official company information. As you can understand, the option “services are provided by the company“ School years are wonderful ”” will not work. Especially for payment systems. Now the full details are available on the site.
- User agreement revision and privacy policy. There were also a couple of little things that needed to be changed.
New Integrations
In fairness, it is worth noting that the integrations themselves were written. But I had to tinker with all sorts of pieces of paper to connect. So, the list of payment methods was replenished:
- Paysera A very good European payment integrator. Allows residents of many EU countries to pay using methods popular in these countries. And they have a good exchange rate.
- PayPal We used to accept it through a partner, but now there is an opportunity to connect directly. In order to fully validate the account, I had to collect a lot
ofdocumentanalyzesand call Dublin a couple of times, recalling my existence. But now we are the happy owners of a fully verified account. - Bank transfer Actually, there is no integration as such. But for those who need closing documents with a seal and a signature, it will soon be possible to download an invoice immediately with them. And if anyone needs straight pieces of paper ... You can also discuss it.
And the plus is the ePayments payment module, I had to write my own code. We will try to release soon.
And I also had to write a more boring integration - uploading all the payment data for a new company to the accounting system. And some more boring, but necessary little things.
VAT calculation
Some of our European customers were not happy with this item. A couple of people even changed their addresses to those that are not from the EU. But be that as it may, since we have received a VAT number, collect it within the European Union and the European Economic Area.
By the way, a few words about VAT in Europe. Rates are governed by the national laws of each country. The minimum permitted standard rate is 15%. The actual standard rates used range from 17% in Luxembourg to 27% in Hungary. The most common rates are 20-21%. In Latvia - 21%. In each country for certain groups of goods and services there are reduced rates, but we do not fall into this category.
New opportunities
Well and how not to advertise. Before I begin, I want to say thank you, dear, but not fond of advertising, reader, for reading up to these lines. If you have any questions, I will be glad to answer here either in PM.
Well, let's go for new features. In brief, I announced them, now in a little more detail.
- Russian GeoIP. Now you can order servers with IP addresses that are identified by WHOIS as belonging to Russia. If this is important for your project - you are welcome.
- Flexible IP transfer. Your project is growing, do you need to move from VPS to the server without changing the IP? Already possible. Recently, we have been working with our own address ranges, which gives us flexibility in assignment.
- Routing your own subnets. Using your IP range? Not a problem either. Now you can secure your subnet to us without any problems. After all, this was so lacking for you.
- Private networks. Need to integrate your servers into a private network? “We have them.” Do you want a private switch - please. It is enough several ports in the general switch - as many as you like.
- Payment by bank transfer. We know that it is more convenient for some legal entities to pay for services by bank transfer and to receive documents for accounting. Now we can offer you this opportunity without any problems and with pleasure.
These features allowed us to offer new products:
- ultra-fast cloud VPS based on NVMe drives at unbelievably low prices - from $ 4.99 per month. Remember GeoIP from the list above? So, even though the servers are physically located in the Netherlands, you can order VPS with IP addresses of both the Netherlands and Russia . Moreover, for only $ 2 per month, you can order additional addresses from any range;
- Enterprise-class servers based on Dell R730xd platforms hosted in the Tier IV data center in the Netherlands. Under the
hood thereare two 14-core Intel Xeon E5-2697 v3, DDR4 memory and the ability to install NVMe disks. Prices for configurations with SSD and / or HDD start at $ 199, options with NVMe start at $ 299. For all servers, both Dutch and Russian IP addresses are also available.
In general, we have become more flexible for your convenience. Thank you for reading a minute of advertising, and welcome to the updated UA-Hosting.