There’s nothing wrong with starting a business at home and having a long-term goal of moving it overseas. Whether this is for tax reasons or reduce costs, there is a lot of information out there for those who want to lift their current operation and move it to another part of the world. There are a lot of decisions involved in moving a business from where you are to another part of the world, including where you should even look! You have to know how you can run your business once you get there. You have to make decisions about your employees – including redundancy packages and rehiring packages for new people to work with you. You need to know where to get the best advice to cover the legalities and taxes.
A lot of companies choose to move their headquarters abroad due to costs. If you are currently working in a country where the costs are astronomical to run and produce, then moving overseas makes an awful lot of sense. There are five main benefits of moving your own company abroad, and a lot of personal steps you need to take before you make that transition. This is including searching for mortgage loans for a property for yourself, as you will also be relocating with your company! We’ve put together some of the benefits of jumping ship and starting up elsewhere:
- Lower Costs. Money is probably the biggest reason that companies move abroad. Companies can save a huge amount of money by doing this due to lower labor costs and lower production costs, too.
- Laws. You want to have life be as easy as possible when moving abroad, and finding somewhere that tops the list of places that has it easy when it comes to getting permits, obtaining business credit lines and has lower taxation is a smart idea! The Far East is always cited as some of the best places to start business in, with Russia and Iran being the bottom of the list for ease.
- Lower Taxes. Businesses need to pay certain taxes to stay afloat and in line with government legislation. Current corporate tax rate in the USA is 35%, which is significantly higher than the 20% charged in the UK. There are places around the world that provide tax incentives for businesses, and you can read more about those here.
- New Markets. Moving abroad gives your business the chance to be a big fish in a small pond rather than the other way around. Tapping into your niche somewhere that there aren’t many companies that do what you do is an intelligent business decision!
While each of those reasons have their merits, there are also things you need to consider before you do abandon ship and go elsewhere. You need to start off by putting together a fantastic and watertight business plan. You would have had to do this for your current business, but going abroad obviously presents different challenges, and so planning the details of your move can give you more structure. You need to work out the costs and the logistics of moving abroad, as well as planning the goals and what you want from the move as a whole. You should have what you want from the business in great detail, especially if you are anticipating having to hire an entirely new workforce. You’ll need to consider language barriers – depending on where you want to set up – and you will need to ensure you have factored every cost and more. Your business plan should overreach on costs where possible, as you will need to consider paying more when the unexpected arises.
Before you move, you should have a decent length of time to prepare financially. You have to ascertain whether your business is even viable in another place across the world and you have to ensure that you know the regulations and tax laws of where you’re headed before you get there. Banking is a key consideration for moving your company abroad, and even if you choose to move and buy abroad with your business, keeping your bank account open at home is a smart decision to make. There’s no use in cutting all ties with your home country if you don’t have to. You will, of course, have to let your bank know you are emigrating, but that doesn’t mean cutting ties.
As you’re putting together a business plan, you’ll be well-aware of the market research you have to do to be up to date in what is required of your business. You need to shop around for the right relocation packages and there are plenty of offshore packages to choose from in varying banks around the world. Business relocation is also about knowing your market before you go. Doing the right research can help you to consider whether relocation for your business is going to be worth anything at all! If there is not a business need for what you can offer, you may find your business flops horrendously when you move it.
The last hurdle you need to consider is culture. With some countries, we’ve mentioned that there could be a language barrier involved. But it does take a little time and a lot of patience to grasp the culture of another country. There could be social rules you are not aware of and it’s going to mean planning on your part to ensure you don’t cause offence. Things that are a natural gesture of politeness in the Western world could be seen as offensive elsewhere, so it makes good sense to do a lot of research about the country that you want to relocate to.
Moving abroad doesn’t have to be a huge mistake. It could be a smooth-running operation and all it takes from you is planning, patience and research to make sure that you know exactly what is involved. Visit the place you want to relocate before committing entirely, and make your whole company excited about the new adventure you are about to embark on!