Top 5 best countries to start a business as a foreigner in Europe

When you start a business in Europe, you gain immediate access to one of the world's most advanced business hubs, complete with sophisticated infrastructure, strong legal protection, and a highly skilled workforce. With a nominal GDP of $15.6 trillion in 2020, the European Union (EU) - the main backbone of Europe - remains the world's second-biggest economy and the world's largest trading market. As a result, it is safe to say that starting a business in Europe as a foreigner is one of the most ideal choices for investors and enterprises around the world.

This leaves us with the question: where exactly in Europe should you land in to set up a new company? This article will help you decide among the top 5 best countries to start a business as a foreigner in Europe.

1. Denmark

The winner for the title “easiest country to start a business in Europe” in recent years most likely belongs to Denmark. The country ranks number 1 for best country in Europe for business by both World Bank and TMF in 2020, and is always in the top 10 when it comes to global rankings. Though the corporate taxation is not very favourable for businesses, Denmark still ranks 7th among the most attractive countries for capital investment by Forbes.

While Denmark is well-known for its top-level social welfare system, the country is also an ideal destination to start a business in Europe. Denmark's economy is one of the best-performing in the EU, with robust growth, low unemployment, and a high GDP per capita. Thanks to an advanced education, the country has a large pool of competent professionals that are fluent in English. The business infrastructure is well-developed, with reliable energy and water supplies as well as a strong financial system.

2. The United Kingdom

Ranked #1 in the list of Best Countries for Business by Forbes, the United Kingdom is among the easiest countries to start a business in Europe. Being the pioneer of the world’s industrial revolution, the UK has made great strides ever since. Up until now, the country still remains an attractive market which brings a lot of opportunities to foreign investors. What makes the UK a desirable market is its business policies, digitization, and a tax system which will support your business in the first few years of operations.

Despite Brexit, the UK GDP growth rate is still in the top of Europe, far exceeding the European and Eurozone averages. London remains the world-leading financial hub, serving as the UK's most prominent commercial and business center. The city is home to some of the world's most prestigious financial institutions, such as the Bank of England, the London Stock Exchange, Barclays, and HSBC. For individuals wishing to start a business in Europe, London's extensive array of financial services and position as an important financial center make it a top choice.

See more: Company Formation in the UK

3. The Netherlands

International investors from all over the world consider the Netherlands as one of the best countries to start a business as a foreigner in Europe. The country has everything it needs for a startup business: an open economy, a strong infrastructure with developed technologies, a broad treaty network, and most importantly, the largest port in Europe.

Furthermore, several tax incentives in the Dutch tax system encourage innovation and growth of companies. The Netherlands also gathers a large number of highly educated foreign workers thanks to its internationally oriented policies. It has proven to be a stable country in an ever-changing world, whether from an economic or political standpoint.

See more: Company Formation in Netherlands

4. Ireland

According to the World Bank, in 2020, Ireland is the best country for business to do taxes. To achieve this, the government implemented a number of business-friendly policies, such as a 12.5% corporate tax rate, one of the lowest rates in the EU, and simplified procedures for starting a business as a foreigner.

Moreover, start-ups may be eligible for a variety of funding options, namely Enterprise Ireland, an Irish government's economic development agency, invests in up to 200 new export-oriented companies every year. Foreign businesses in Ireland are also accessible to experienced, high-tech workforce, various investors, research opportunities, producers, and suppliers. For this reason, many well-known technology corporations (such as Google, Facebook, Twitter and LinkedIn) have built their European headquarters here.

5. Switzerland

Switzerland might not be the easiest country to start a business in Europe, but it surely brings a lot of benefits to your company. Constantly ranked 1st in Europe in terms of economic freedom, Switzerland can guarantee to provide the best environment for foreign businesses so that they can grow to their fullest potential. A talented workforce, a stable political system, well-established infrastructure, liquid and sophisticated financial markets, low taxes, and a robust service sector all contribute to Switzerland's economy.

Banking and financial services of Switzerland are widely regarded as the most advanced in the world. Due to its financial stability and a long record of fiscal discipline, Swiss banking policies, expertise, and trustworthiness make it an appealing alternative for global businesses and individuals alike. It's no surprise that Swiss banks manage the majority of the world's wealth.

See more: Company Formation in Switzerland