The value of the corporate income tax rate is, for some investors, one of the top criteria when deciding where to base their business. This, alongside other business benefits in the chosen jurisdiction, can help investors set up their business for success.
This list contains 5 low tax countries that are perfect for starting a business.
- Belize
Opening a company in Belize is convenient for many investors, particularly those who are interested in doing business in the Americas. The corporate income tax is very low in this jurisdiction, at 1.75% for many types of businesses. Businesses can also be subject to exemption from taxation when they qualify as per the Income and Business Tax Act.
Investors should know that a certain type of company in Belize, the International Business Company, is exempt from most types of taxes, making it the preferred business form for foreign investors.
- Romania
Romania is one of the countries in Eastern Europe that offers a favorable taxation regime, particularly for micro-companies. The regular corporate income tax rate is 16%; however, qualifying micro-companies can be subject to lower rates of 3% and 1% depending on certain factors.
Investors who open a company that qualifies as a microenterprise should know that the lowest rate applies to companies that have at least one employee and a maximum of nine. Romania has been recognized as the 38th most entrepreneurial country in the world, according to the CEOWORLD magazine Entrepreneurship Index, 2019.
- Isle of Man
An offshore company in the Isle of Man is exempt from taxes depending on the business sector in which it activates. While most business fields are not subject to tax, banks and retail businesses are subject to taxation on their annual profits, according to certain criteria.
Company formation is easy in the Isle of Man and investors also enjoy the advantage of being located close to the United Kingdom.
- Hungary
Hungary is another country in Europe that offers a low corporate income tax rate, at 9%. The country has become more attractive to foreign investors as a result of this favorable taxation policy. Another advantage for investors is the skilled workforce and lower costs related to employment compared to other EU countries.
- Ireland
The country is known for its attractive business policies and its low corporate income tax rate of 12.5%. Other reasons why investors choose to base their business here include access to a talented workforce and various investment incentives. Ireland ranked No. 14 in the CEOWORLD magazine’s ranking of the world’s most entrepreneurial economies for 2019.
Investors should explore all of these options as well as other low tax countries before deciding where to set up their business.
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