5 Best Countries To Register A Business As A Digital Nomad
In a blog post last year, we looked at some niche online businesses ideally suited for Estonia's innovative e-residency scheme. If the digital nomad lifestyle is for you, you will be a part of a community of over 4.8 million people. This is set to increase to a whopping 17 million aspiring freelancers in the near future. Just think, that's 13 times bigger than the population of Estonia!
Here are some 50+ Digital Nomad Statistics, Facts, and Trends [2022]
So, let's dive in and see where the latest opportunities present themselves. And don't just take our word for it. Use our recommendations as a springboard for your research. Who knows where you will end up?
SAAS — USA
Where better than the land of the free and home of the brave? And brave you will have to be. SaaS is a rapidly growing sector. You will have to compete with over 7000 companies in the US markets alone. Before you let that worry you, check our post on first-order thinking and the tip we shared from American billionaire Ray Dalio.
With that in mind, let's consider why the US is the best location for your SaaS business.
The US is a prominent place. So, where exactly would we suggest? Delaware's reputation as an incorporation centre, as a low-tax state and known for its well-developed body of law that reassures potential investors is a firm favourite.
Delaware-raised President Joe Biden's appointments in his cabinet hint that his administration will positively affect the industry. With cybersecurity and robust digital infrastructures at the forefront of his tech-related policies, SaaS businesses are a safe bet, given that they are known for their strong security measures. It's doubtful that your business model will be subject to strict regulations if you can provide a service protected by firewalls, an intrusion prevention system, and anti-virus software.
E-COMMERCE — UK
It's time for some statistics. We'll keep it brief. However, your head may still whirl (because of the potential your business could have registered in the UK). First, the UK enjoys the most advanced e-commerce market in Europe. It was estimated that consumers spent £141.33 billion in 2020, a 34.7% increase from 2019.
With the vibrant online clothes and sportswear industry, is it any surprise that these goods were voted most popular online with a share of 60%? Compared to household items at 49%, groceries at 34%, and telecommunication services at just 22%. An e-commerce company is a great idea, especially when it has proven to be unaffected by the impact of COVID-19. There was an increase of £5.3 billion despite the pandemic.
The process to register a company in the UK is simple. You register as a sole trader or Limited Company with Companies House and pay a small fee. If registering as a sole trader, that fee is currently just £12.
Twelve pounds! For access to an international market. In 2019 showed that 76% of the UK population purchased their goods online. There is enormous potential for a low sign-up cost, straightforward registration, and a high-demand market.
It is worth considering if you will look to sell within the EU. With Britain's recent departure, you may face additional obstacles.
CONSULTANTS & COACHES — DENMARK
Admittedly, the expertise of consultants and coaches spans many fields, and there are many countries where you could just as quickly set up a consultancy. So what sets Denmark apart?
This requires online businesses to have a bigger chance of needing employees in the future than any other on this list. After all, you are only one person. You cannot attend two meetings with different clients at the same time. If demand required it, you might need to employ a couple of fellow freelancers one day. Denmark's "flexicurity" surrounding hiring and firing allows you to scale your business size to suit your circumstances.
Side note: Be sure to check out our post on How to Manage a Remote Team if you hire employees in the future.
On top of this, in 2015, Denmark has voted the best country in the world for transparency in trading across borders. In 2016, Denmark was voted 3rd in the World Bank Index for Ease of Doing Business. Simple regulations that are up-to-date with current EU legislation mean you could incorporate your business within a matter of days. Your online consultancy would also be centrally located in Europe. While this would be the same if you were to register in a country such as Germany, what sets Denmark apart, particularly against other Nordic countries, is its efficient tax system.
It's clear from online research that Denmark enjoys an excellent reputation amongst freelance consultants. Especially Copenhagen. The potential to establish a lucrative and successful consultancy is second to none.
SOFTWARE DEVELOPERS — GEORGIA
If you are from the EU, Balkans, USA, South America or some countries in the Middle East and Asia, you can step foot in Georgia visa-free. At the moment, Georgia is on the verge of a digital revolution. Like many post-Soviet nations, it is at the precipice of a tech boom as the innovation and creative methods of building new sectors begin to yield success for its people.
Georgia has recently used similar tax rules as Estonia. With a comparable tax-deferred model, you do not need to pay tax if you do not pay dividends. This helps the business grow. One condition of setting up an LLC (the most popular type of company) in Georgia has a registered office there. Of course, this isn't a problem if you plan on staying there for the year and have the means to pay rent for a small office space.
Remember, whilst in Georgia, you would have access to a talented pool of young people learning software development. This allows them to earn up to twenty times more than the salaries associated with more traditional careers in economics, politics and law. This is more apparent with statistics suggesting two tech start-ups launch each week. Therefore, even if you can't always be there in person, you know your business will be in capable hands in a bustling sector and will work for you.
SINGAPORE — FINTECH & CRYPTO
Crypto is not well understood or is not being considered by many nations across the world. Whilst some countries have fallen behind in understanding the potential of widespread blockchain technology in our society, others, like Singapore, have stepped up to lead the way.
Voted the world's freest economy in the 2020 index, Singapore's flexible taxes are ideal for a digital nomad. After all, there is no need to have offices or employees in Singapore. This avoids requirements that some countries force freelancers to employ local personnel. Suppose you are considering Singapore as a base for your operations. In that case, you will need to get to grips with the modern regulatory framework placed on companies by the Monetary Authority of Singapore. But with DBS, the biggest bank in Singapore, steaming ahead to launch crypto trading services, it is clear that these regulations suit the country's developing crypto space.
And there's more! The government has helped crypto start-ups open local bank accounts. It seems Singapore is the place for a digital nomad looking to launch their own crypto business.
ESTONIA — THE BEST FOR ALL INDUSTRIES
You're probably wondering why we're promoting other jurisdictions in our blog. Well, it's pretty simple. Estonia combines the best of all the above possibilities. It's tax-efficient, cost-efficient, and as easy as it gets to start and manage the business. We have crypto-friendly regulations, and many of the world's biggest crypto companies are present here. Of course, Estonia is part of the EU's single market.
With e-Residency, you can incorporate your business in Estonia, taking advantage of the EU single market and Estonia's excellent digital services. However, you don't need to be physically located in Estonia.
On top of this, Estonia has a simple and favourable taxation system, meaning you will have more money to reinvest into your growing empire.
CONCLUSION
Phew! A lot of information to digest. Hopefully, we have set you on the right trail to do some research that will be vital to the success of your online businesses. Of course, this is a crucial decision to make. If you would like more advice, please contact us directly.
