Discover the Best Country to Start a Business as a Foreigner in 2024

Key Takeaways

• Singapore, Hong Kong, and New Zealand are among the best countries for foreign entrepreneurs to start a business due to their strategic locations, favourable tax rates, great workforces, and robust legal systems.
• The United Kingdom, Denmark, and Switzerland offer supportive environments for business growth and innovation, characterised by high-skilled talent, conducive regulatory frameworks, and significant investment in research and development.
• Navigating local tax systems, managing cultural differences, and overcoming language barriers are key challenges for foreign business owners, but the best countries with business-friendly regulations and tax incentives can ease these challenges.

1 Singapore: A Hub for International Entrepreneurs

Singapore’s location, laws, and business-friendly environment make it the top choice for foreign companies and entrepreneurs who want to start a business and grow their business and trade. Singapore's diverse economy allows entrepreneurs to identify and target any lucrative market niche effectively.

Favourable corporate tax rates

Singapore has a 17% flat corporate tax rate, one of the lowest in the world, coupled with a low personal income tax, making it highly attractive for both businesses and individuals. In addition to that, there are various tax incentives and exemptions, and it’s a great place for businesses and foreign investors to set up and grow. The government’s business-friendly tax policies reduce the financial burden on companies and promote growth and innovation for those who want to start a business.

Skilled workforce

Singapore has a highly skilled and diverse workforce across various industries, including finance, technology, healthcare, and logistics. The country’s focus on education and professional development ensures a constant supply of talented professionals. The stable government and business-friendly policies create an environment where businesses can grow and expand smoothly.

Excellent trade agreements

Singapore has a large network of established trade agreements that open up the world to its businesses. These agreements, including FTAs with major economies, help to facilitate international trade. They reduce trade barriers, simplify export and import processes and give businesses an edge in the global market. In other words, you can start a business in Singapore with ease.

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2 Hong Kong: A Dynamic Business Landscape

Hong Kong’s economy and location make it a great place for foreign companies. As a Special Administrative Region of China, Hong Kong benefits from unique economic and administrative advantages that support growth. Some of the benefits of doing business in Hong Kong are:

• Business-friendly regulations
• Fast business setup
• Low tax
• Strong legal system
• Access to global markets

Favourable tax environment

Hong Kong has one of the lowest tax rates in the world, with minimal personal and corporate tax. The simplicity and transparency of the tax system mean big tax breaks for business growth, which is a very attractive place for entrepreneurs and investors to start a business and make profits while minimising tax.

Strategic location

Hong Kong is located near Mainland China, other countries, and major cities in the Asian market, and it is the hub for business. Close to the manufacturing centres and easy travel options, it’s the perfect base to manage the supply chain and access the huge Asian market. Geographical advantage means easy logistics and seamless integration into the regional economy.

Robust legal system

Hong Kong’s common law system provides a stable and transparent environment for business, with robust intellectual property protections. Strong IP protection means a safe haven for local and foreign companies. The established legal system means fairness and reliability so you can start a business and retain peace of mind.

3 The United Kingdom: Supportive Environment for Growth and Innovation

The United Kingdom provides a conducive environment for growth and innovation. Some of the reasons why the UK is a great place for entrepreneurs include:

• Strategic initiatives to boost R&D public investment
• Commitment to establishing itself as a global innovation hub
• Numerous opportunities for foreign entrepreneurs to start a business

Favourable business environment

The UK’s favourable business environment is characterised by strategic initiatives like tax reforms and easing planning restrictions. Aside from being the most populous country on this list, the UK offers some of the lowest average corporation tax rates among G20 countries, fostering a competitive economy and business expansion.

Talented workforce and innovation

The UK attracts high-skilled talent through new visa routes such as the High Potential Individual and Scale-up visas. The government’s investment in R&D and support for innovative companies further enhances the UK's standing in the European market.

Legal and cultural advantages

Benefits of operating a business in the UK include:

• Strong legal system
• English as the main language
• Strong ties with Europe
• Competitive tax rates

These make it easier to start a business in this foreign country, even attracting the attention of the World Bank. Operating within the UK also grants access to the European Single Market, providing vast opportunities for trade and collaboration across Europe.

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4 New Zealand: An Entrepreneur’s Paradise

New Zealand’s attractive features for foreign entrepreneurs include:

• Stable economic environment
• High living standards
• Strategic market access
• Conducive business environment
• Supportive stance for new businesses

Opening a local bank account in New Zealand is also hassle-free, facilitating smooth financial operations for foreign entrepreneurs.

Business-friendly regulations

New Zealand ranks high in ease of doing business due to its straightforward company registration process. The minimal bureaucratic hurdles make it easier for entrepreneurs to start a business.

Quality of life

New Zealand has:

• Great work-life balance
• Government-funded universal healthcare
• High quality of life
• 20 days annual leave

These factors attract foreign entrepreneurs to the country.

Strategic market access

New Zealand’s location provides access to key markets in the Asia-Pacific region.

5 United Arab Emirates: Tax-Free Zones and Strategic Location

Tax-free zones, location and free trade zone agreements, plus a business-friendly environment and tax incentives, make the UAE a great destination for businesses across all sectors. The UAE’s location and free trade agreements can be highly beneficial.

Free trade zones

UAE’s free trade zones offer tax benefits and exemptions, including 0% corporate tax on qualifying activities, making them ideal for businesses aiming to optimise their tax liabilities. 100% foreign ownership and profit repatriation make them very attractive for entrepreneurs looking to start a business abroad.

Attractive destination for various sectors

UAE supports tech and finance sectors through tax regimes in free zones. The country’s economy and location make it even more appealing for business.

Strong trade agreements

The UAE has an extensive network of double tax agreements with more than 100 countries. These agreements facilitate smoother international business operations and enhance the country’s attractiveness for global business expansion.

6 Switzerland: Stability and Innovation

Switzerland’s appeal to foreign businesses includes:

• Stable environment
• Innovative approach
• Favourable corporate tax
• Effective administration
• Highly capable workforce

These factors make Switzerland one of the best European countries to start new businesses and innovative startups in advanced industries. Setting up a corporate bank account in Switzerland is straightforward, adding to the ease of doing business in this stable and innovative country.

Favourable corporate tax rates

Switzerland’s moderate taxes, including favourable treatment of capital gains, are the key to its prosperity and attractiveness for international companies. Companies with significant shareholdings in other companies get tax breaks, so the tax burden on profits is reduced.

Highly skilled workforce

Switzerland has a talented workforce supported by top research institutions and an education system aligned with industry needs. This makes the country more competitive and innovative.

Well-established trade agreements

Switzerland’s numerous free trade agreements facilitate international business by reducing or eliminating customs duties. These agreements create a favourable business environment and encourage government support for business expansion.

7 Denmark: Easy Access to European Markets

Denmark, with fast access to European markets, a motivated workforce, a strategic location and plenty of business opportunities in the export market, is a top destination for foreign corporations.

Business-friendly environment

Denmark, often considered the best country in terms of political stability, offers high levels of trust and minimal corruption, and a commitment to free market principles. As the most politically stable country, Denmark's transparent tax system and accessible government agencies further support business operations.

Innovation hub

Denmark is the innovation champion of Europe and in the tech sector. Denmark has a thriving startup scene, with business giants like Pleo, Trustpilot and Zendesk coming out of Denmark.

Global connectivity

Denmark has a great logistics and distribution infrastructure in Europe. It’s high up in the World Bank’s Doing Business Index and Forbes’ capital investment attractiveness ranking.

Denmark is also committed to green energy and has a flexible labour market.

Overcoming Challenges as a Foreign Business Owner

Running a business overseas has its own challenges – tax systems, cultural differences, and language barriers. But the rewards – new markets, new lifestyles – are often worth it.

Understanding these aspects is crucial for successful business operations and growth.

Navigating local tax systems

Tax systems can be tricky, but knowing tax treaties and laws can help you avoid double taxation and reduce taxes. Accountants or tax advisors can be very helpful in this area.

Switzerland and UAE (and other countries) have low corporate tax and tax benefits, so they are popular destinations for foreign businesses.

Managing cultural differences

Managing cultural differences involves:

• Understanding and respecting local customs, values, and beliefs
• Successful business ventures, especially on an international scale, rely heavily on effective communication
• Effective communication is crucial for ensuring smooth operations and building strong partnerships.

Building personal relationships and adapting marketing strategies to local consumer behaviour can help overcome cultural challenges and foster successful partnerships.

Dealing with language barriers

Language can be a barrier in a foreign business environment. Get local staff or consultants who speak the language to fill the gap.

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How To Set Up a Business Abroad: Step-by-Step Guide

Setting up a new business in another country involves several key steps, including research and planning, understanding legal requirements, and building local partnerships.

A structured approach can help mitigate risks and ensure a successful business launch in a foreign country.

Research and planning

Research and planning are critical first steps when setting up a new business in a foreign country. Performing a SWOT analysis, analysing the competitive landscape, and assessing market volume and growth potential are essential.

Understanding local consumer behaviour and communication channels can significantly impact market penetration and growth.

Legal requirements

Understanding and complying with the legal requirements of the target country is crucial. This includes business registration, obtaining necessary permits and licenses, and adhering to local tax laws. Consulting with local legal experts can help ensure compliance and avoid potential legal issues.

Building local partnerships

Building local partnerships is vital for navigating the new market effectively. These partnerships can provide valuable insights into global market dynamics and consumer preferences, enhance brand credibility, and help overcome bureaucratic hurdles.

Hiring local consultants can also aid in bridging cultural and language differences.

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Summary

When choosing the right country to start a business as a foreigner, you need to consider tax rates, skilled workforce, legal systems and market access. Singapore, Hong Kong, the UK, New Zealand, the UAE, Switzerland and Denmark all have their own advantages for international entrepreneurs. Once you know these benefits and overcome the obstacles, you can start and grow your business abroad.

Heather CameronBusiness Writer

Heather is here to inform and inspire our readers. Boasting eight years in the world of digital marketing, working in diverse industries like finance and travel, she has experience writing for various audiences. As Osome’s resident copywriter, Heather crafts compelling content, including expert guides, helpful accounting tips, and insights into the latest fintech trends that will help entrepreneurs, founders and small business owners in Hong Kong take their businesses to the next level.

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