Best EU countries for taxes for freelancers

22 posts in this topic

Hej folks, which countries in  EU work best for freelancers wrt taxes.

 

I do not want to pay such high taxes in Germany or Denmark. Any suggestions - Czech, Portugal?

 

Appreciate your suggestions.

1

Share this post


Link to post
Share on other sites
17 hours ago, SpaceOne said:

Romania with it's 10% income tax rate perhaps? 

True so is Bulgaria. Both are good options.

 

Someone suggested following structure

Live in Portugal on NHR 

Set up company in Matla and pay taxes in Matla for the company.

Pay personal taxes in Portgual.

From quality of life pov Lisbon sounds better than Bulgaria.

 

Maybe someone can suggest legality of this structure and some experiences with this.

1

Share this post


Link to post
Share on other sites
21 hours ago, kapil354 said:

Hej folks, which countries in EU work best for freelancers wrt taxes.

Why does it have to be an EU country?  In Switzerland you'd pay around half the tax you do in Germany, if not far less than that, depending on where you live, how much you earn and how much of that you actually declare;) 

0

Share this post


Link to post
Share on other sites

Didnt realize that Swiss taxes for freelancers are that low?! Interesting. Will explore more.

 

Can I issue an invoice without a local address from Zug? So registering a business without local address? (I have German passport if that matters). 

Two cases

1. Selling online digital products with no physcial setup. 

2. Giving consulting services across EU

1

Share this post


Link to post
Share on other sites
12 minutes ago, kapil354 said:

Didnt realize that Swiss taxes for freelancers are that low?! Interesting. Will explore more.  

Can I issue an invoice without a local address from Zug? So registering a business without local address? (I have German passport if that matters). Two cases 

1. Selling online digital products with no physcial setup. 

2. Giving consulting services across EU

Yes, Swiss taxes are much lower generally.

Your tax free allowance is also probably double that of Germany's.

Though health insurance is not paid for by employers - it's almost all private - and compulsory. 

Having a German passport in this case does matter. It gives you priority access to Switzerland under FOM, so you get a permit to live and work there without even having a job. The permit would allow self-employment also. If you were then living there, you'd be able to set up your business, digitally as well of course. 

0

Share this post


Link to post
Share on other sites

Depending on what you are doing, this might be interesting.

 

https://e-resident.gov.ee/

 

A long time ago when I first started freelancing in Germany, I was told that setting up a company in a low domicile is an invitation to the German Finanzamt to scrutinize your financial life and business activities.  

 

Good luck and please let the board know what you decide to do.

0

Share this post


Link to post
Share on other sites
51 minutes ago, balticus said:

A long time ago when I first started freelancing in Germany, I was told that setting up a company in a low domicile is an invitation to the German Finanzamt to scrutinize your financial life and business activities. 

Though presumably there'd be no advantage in double residence and the German one would be dropped upon moving to another EU/EFTA/UK country. And at that stage the German tax office can only scrutinize the past, not anything new. :) 

1

Share this post


Link to post
Share on other sites

You start by asking about taxes for freelancers and then ask about setting up a company. They are two very different things with different regulations, running costs and tax rates.

1

Share this post


Link to post
Share on other sites
3 hours ago, lunaCH said:

Why does it have to be an EU country?  In Switzerland you'd pay around half the tax you do in Germany, if not far less than that, depending on where you live, how much you earn and how much of that you actually declare;) 

Because living there is super expensive?

 

Portugal has some attractive taxes for people entering the country, as long as they work in some special fields like software.

Quality of life is great all over the country. Lisbon is nice, but not so cheap. Many small towns offer better value.

1

Share this post


Link to post
Share on other sites
1 hour ago, lunaCH said:

Though presumably there'd be no advantage in double residence and the German one would be dropped upon moving to another EU/EFTA/UK country. And at that stage the German tax office can only scrutinize the past, not anything new. :) 

 

The e-residence program is set up for people who want to start companies with access to the EU market without necessarily ever living in the EU.   To get e-residency, I don't think it is even necessary to have visited Estonia.    Look at the link i posted to see more info. 

 

50 minutes ago, evildudette said:

You start by asking about taxes for freelancers and then ask about setting up a company. They are two very different things with different regulations, running costs and tax rates.

 

Speaking from my own experiences, considering the different options for freelancing versus starting a company and whether a GbR or GmbH or the offshore equivalents would be best, seems to be all part of the same process.   Going through the process helps clarify the pros and cons of each and also helps direct business development in the most constructive way.    Keeping all realistic options open at the beginning is not a bad idea, IMHO.  

1

Share this post


Link to post
Share on other sites
34 minutes ago, MikeMelga said:

Because living there is super expensive?

Yes but if you are paying much lower taxes, there may be some gain. Quality/standard of living should be taken in to consideration. :) 

Another option is to live close to the border on the German side, this lowers costs considerably - the taxes are presumably a bit lower also. Tens of thousands of people from each country that borders Switzerland do this  

1

Share this post


Link to post
Share on other sites
37 minutes ago, lunaCH said:

Yes but if you are paying much lower taxes, there may be some gain. Quality/standard of living should be taken in to consideration. :) 

Another option is to live close to the border on the German side, this lowers costs considerably - the taxes are presumably a bit lower also. Tens of thousands of people from each country that borders Switzerland do this  

How about living in a small nice Swiss village - rents are high there too?

 

My work is location independent. I travel for meetings sometimes and that can be managed from any where from EU (assuming no travel restrictions)

1

Share this post


Link to post
Share on other sites

Rents are lower in smaller villages, unless they are very low tax ones, in which case they may be a bit higher, but not as high as in much larger towns or cities. Border cantons are less expensive generally than say Bern or Zurich (although even Zurich is a border canton, those areas will be less expensive than further 'inland'). 

0

Share this post


Link to post
Share on other sites
Just now, lunaCH said:

Rents are lower in smaller villages, unless they are very low tax ones, in which case they may be a bit higher, but not as high as in much larger towns or cities. Border cantons are less expensive generally than say Bern or Zurich (although even Zurich is a border canton, those areas will be less expensive than further 'inland'). 

thanks Luna!!

Any villages I could explore? :)

 

(as you can see I prefer low taxes and an easy life) :) 

1

Share this post


Link to post
Share on other sites
8 minutes ago, kapil354 said:

as you can see I prefer low taxes and an easy life

Doesn't everyone? :) Better still, no taxes. ;) 

Here https://en.comparis.ch/steuern/steuervergleich/default you can compare how much tax you would pay depending on where you live. 

Here https://en.comparis.ch/immobilien/default you can check available dwellings. This search engine brings together results from many (not all) sites - which saves checking a lot of different sites individually. :) 

0

Share this post


Link to post
Share on other sites
6 hours ago, balticus said:

 

 

Speaking from my own experiences, considering the different options for freelancing versus starting a company and whether a GbR or GmbH or the offshore equivalents would be best, seems to be all part of the same process.   Going through the process helps clarify the pros and cons of each and also helps direct business development in the most constructive way.    Keeping all realistic options open at the beginning is not a bad idea, IMHO.  


Potentially yes, I pointed it out because conflating the two is likely to lead to problems down the line - if he is aware of that then great :) I run a business helping companies expand into new countries and see business owners make these mistakes all the time, so just wanted to highlight it.

 

kapil you may want want to think about whether ‘lowest tax’ is really the right question to be asking. As you’re talking about businesses that are location independent, you need to consider your business strategy and pricing in relation to where you will be living. If you are consulting companies all over the EU, the price you will need to charge in order to cover your living costs is going to be very different in Switzerland compared to Portugal. If the amount of money you will make is not dependent on where you are living, you should also consider the quality of life you will be able to afford in each place when your revenues come in.

3

Share this post


Link to post
Share on other sites

In Cyprus the corporate tax for certain industries (forgot which ones exactly, l think those dealing with intellectual property) is only 2.5%, otherwise 12.5%. And everyone speaks English. Almost everyone at least. Last week though I was dining at a restaurant with a German friend who thought she spoke Greek well enough to order a bone for my dog as the waiter didn't understand the word "bone". That "bone" she had ordered looked like a very nice steak and cost more than my fish&chips.😃 Doggie didn't mind though.

 

2

Share this post


Link to post
Share on other sites
28 minutes ago, jeba said:

In Cyprus the corporate tax for certain industries (forgot which ones exactly, l think those dealing with intellectual property) is only 2.5%, otherwise 12.5%. And everyone speaks English. Almost everyone at least. Last week though I was dining at a restaurant with a German friend who thought she spoke Greek well enough to order a bone for my dog as the waiter didn't understand the word "bone". That "bone" she had ordered looked like a very nice steak and cost more than my fish&chips.😃 Doggie didn't mind though.

 

Thanks for the Cryptic hint about Cyprus...

1

Share this post


Link to post
Share on other sites

I forgot to mention that (unless you or your father are Cypriot) Cyprus is granting non-domiciled status for 17 years after moving here and that there is no tax on dividends anyway. There is a mandatory contribution for defense but as non-dom you're exempt.

2

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!


Register a new account

Sign in

Already have an account? Sign in here.


Sign In Now