Running a start-up business is challenging, but at the same time, it is also interesting and offers many opportunities. The main reason for opening a company is to make a profit, but running and developing a business also helps to up one’s self-esteem and get appreciated by others. However, there are various challenges for a young entrepreneur, requiring specific skills, knowledge, flexibility and the ability to find non-standard solutions. Setting up a business in the UK and Europe, in general, also calls for the knowledge of both business practices and the legal landscape of the chosen country.
Running a business has never been easy, but now the world is facing new challenges and hurdles. Each country has its challenges, for example, a strict taxation system combined with complex legislation, monopolisation of all spheres, political and economic issues, etc. Below are the most common risks.
Business owners often struggle desperately, solving a thousand problems and looking for a million solutions. But in the end, after selling a product or service, paying taxes, wages, and deducting the production cost, they earn less money than a public sector employee who works less, with fewer responsibilities, but whose back is protected by the government. Then entrepreneurs have to look for new and effective solutions to make their beloved business profitable.
Legislators are constantly working and updating the system. While entrepreneurs adapt to new conditions, other amendments are already being drafted. This goes on and on to keep up with the rapidly changing world. That is why it is especially important to be aware of all the changes, know the legislation of the country and be able to practise it.
Any business turnover is an excellent basis for taxation. As soon as you get any income, you should prepare and submit financial accounts and pay taxes. There are economic zones and tax regimes that can make your life easier; they exist in many countries, e.g. in the Czech Republic, start-ups are not required to pay taxes for the first three years. You can save money and increase profits more quickly if you know this.
It is difficult to find your niche within traditional industries occupied by medium-sized and large companies. Your best shot would be to develop your original idea. You should offer something new to the market to meet customers’ need or to create that gap and fill it.
Many start-up entrepreneurs think about starting a business abroad. It is not as difficult as it seems at first glance. Legislation is already there most of the time to support entrepreneurs with no major changes expected. To relocate, a businessman needs to apply for a Start-up visa. It guarantees that they will get support in the chosen country where they move with their family, and later get a permanent residence permit leading to citizenship. It is a great solution for people who want to realise their ideas.
There are common requirements for a Start-up visa: – Knowledge of the official language of the country – An original business plan – A viable business idea – Clear perspectives for developing the idea – Money to support yourself without government support.
Specific requirements for obtaining a Start-up visa in each country are given below.
The UK attracts people with its stable economic growth, and tax and banking incentives. The government monitors the domestic market, so it can create new opportunities for business owners. Tier 1 Entrepreneur visa used to offer the same opportunities as the UK Start-up visa but it was closed. Now start-up businesspeople are not required to invest in the business to get a visa or find a partner.
A UK Start-up visa does not lead to an Indefinite Leave to Remain (ILR), or settlement. It cannot be extended and therefore immigration advisors recommend thinking about switching to a UK Innovator visa in advance.
Differences between visas are presented in the video below.
UK Start-up and Innovator Visas: What are the requirements and how to obtain them?
Requirements for a UK Start-up visa: – To be at least 18 years old – To speak English at Level B2 – To submit a medical certificate and negative tuberculosis test – To have no criminal records – To have at least £1,270 in a bank account to support oneself and £315 for each dependant.
Everything starts with an application for a UK Start-up visa that gives details of a proposed business plan. It should: – Be innovative (offer a unique service/goods to fill a gap in the UK market); – Identify funds to start a business that are legally sourced; – Further plans must be realistic and based on the analysis of the current situation; – Be scalable (the project could be developed further and benefit the UK economy even more; it could be the development of a chain and expansion of production that will increase turnover and create jobs).
This UK start-up visa application is then used by the relevant endorsing body to issue an endorsement letter. A visa is issued based on this letter. There is an updated list of endorsing bodies on the official government website.
The endorsement body authorised by the UK Home Office may lose its status if there are concerns about its activities. If this happens and the endorsing body is removed from the approved list, you will also lose your endorsement and have to find another endorser. Therefore, authorised endorsers value their reputation. They review all applications thoroughly. Besides, a foreign entrepreneur, once in the country, must submit a report to an endorsing body after 6, 12 months of the company’s being operational. If it is not done, your endorsement letter will be withdrawn.
A UK Start-up visa is issued for 2 years and cannot be extended. However, you can switch to a UK Innovator visa or Investor Visa either of which leads to an Indefinite Leave to Remain (ILR) for yourself and your family and eventually apply for citizenship.
Latvia welcomes unique business ideas, especially in the areas of environment, shipping, social system and infrastructure in remote regions. You must provide: – A description of your innovative idea (around 15 pages), clearly stating the challenge, proposed solutions and future perspectives; – A personal and career statement; – An essay about why you chose Latvia and why you want to move there.
There are no requirements as to the amount of private investment. To get a Start-up visa, however, you will need around €5,000-6,000 (a guarantee that an applicant can maintain themselves) and €115 in application fees.
Your business plan must be sent by e-mail to the Investment and Development Agency of Latvia. You get a decision and a residence permit within 4 months. Upon approval, you will also get a letter with instructions on how to register your business, which grants you can apply for, what benefits you can receive, etc. Later a foreigner must submit annual reports to an endorsing body: achievements and how they compare to the original plan. You can become a permanent resident only after 5 years.
In the Netherlands, Start-up visas are issued with the backing of so-called facilitators. They are accredited and involved in selecting worthy projects and supporting them going forward. They work either for a fee or a share in the company.
There is a list of facilitators on the Immigration and Naturalisation Service website where you should submit your idea. IT, social services and marketing have the best chances. It is compulsory to have a pilot project. However, your project can be refused if an authorised person finds it too complicated or infeasible to implement. This is why ideas are usually sent to several facilitators at the same time to increase the chances of success. If the project is approved, you will arrange to meet the facilitator to discuss the idea in detail. Then follows a final approval and you can start collecting documents for a Start-up visa which you will submit to the immigration authorities. You will also have to appear in person several times.
The Start-up visa application fee is €326 and the whole process takes up to 10 months. Moreover, you must have at least €18,000 in your bank account to support yourself.
At first, a residence permit is issued for 1 year, which can be extended for 2 years, and later, you may obtain a permanent residence permit, and then citizenship.
Facilitators will guide you through the whole process and even help you with some parts of it.
You can get a Portugal Start-up visa by submitting a detailed business project to an approved incubator on the Startup Portugal program website. An applicant should upload a detailed business plan, a criminal record certificate and a bank statement confirming a balance of €8,000 to support themselves. Once the application is approved, you have 40 days to sign an Incubation Agreement. Then all the necessary documents are collected and submitted to the Portuguese Immigration and Borders Service. Remember to translate everything into Portuguese. It normally takes 5 to 7 months to go through all the steps and the fee is almost €250.
If you want to continue running a business in Portugal, you should create at least 5 jobs or earn €300,000 in 5 years.
In the aftermath of the coronavirus pandemic, France has simplified the process of obtaining a Start-up visa. The French Tech Visa was launched in 2017 offering entrepreneurs the most favourable conditions.
Accelerators review a business plan and decide on its relevance. They find partners, investors, and affordable office spaces, as well as help with tax and legal issues. A list of accelerators can be found on the French Tech Visa website.
France welcomes experts in all spheres: IT, cultural and environmental projects. If an application is approved, an accelerator signs an agreement according to which they receive up to €500 per month from an applicant and in return, they provide full assistance in all business affairs: finding the most suitable rental options, reliable partners, liaison with tax authorities and legal advice. An important aspect is economic zones with the lowest cost to run a business.
Other visa requirements – Vaccination certificates of the European standard – Knowledge of French – At least €20,000 in a bank account – Payment of application fees and a residence permit charge (about €300) – Patience, because a decision can take up to 9 months due to big demand.
It is always exciting to start a business in another country, but the first step is to prepare the necessary documents. While it is almost impossible for immigration advisors to help create a brilliant start-up idea, they can give the existing one a proper shape and support it with the correct documents. As it is explained above, each country has its regulations and a strict set of documents to submit. Even if a single document is missing or any part of the application is filled in incorrectly, it will be refused. Of course, you can re-apply, but it can take another 7 to 9 months. An entrepreneur does not have that time if they want to establish and run a business. While you are struggling with filling in a project description form, someone else has come up with the same idea and already got in touch with advisors, prepared documents and is on their way towards the end goal.
Imperial & Legal’s qualified advisors have a long record of successfully solving immigration cases in the UK and abroad. They will take you through the Start-up visa application process and do it thoroughly, quickly and by the rules of a particular country. Do not waste time, money and opportunity – get in touch with a competent immigration advisor.
We will work with you to find a customised solution for your immigration, second citizenship, business, tax and other needs.
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