*This information is not legal advice in any way, also most of it is valid only for EU citizens.
Opening a company in any European country now is pretty easy, in some countries it can happen in hours or 1 day. But that’s not the issue here, opening the company is the easy part, but in order for a company to trade it also needs a bank account.
What most of the companies that handle the registration of new companies fail to tell you is that opening the bank account in Ireland (or other European countries) for a company that is owned by a non-resident, it is a very difficult task. This is mostly due to money laundering laws, but also other quirks of the respective country and banking system as well.
Without a bank account the company is useless, you can’t trade, you can’t open a merchant account or do anything else.
Therefore what they do for a hefty fee is to give you the option to add a resident director or company secretary. So in the management of the company you will have a resident director/company secretary but it’s there just for the paper work.
After searching for a while and reading about other jurisdictions, Ireland is a great country to open a company if you are selling worldwide especially software. Most of the tech giants are there, from Google to Microsoft and Facebook. They have low taxes (12.5%) and their tax system is easy to understand most of the time, the official language is English, so we didn’t have to learn a new language, also we have direct flights a few times a week, plus other things.
Also I want to mention the Irish people are really cool, very friendly and I love their whiskey ;). One thing I’ve learned they handle a bit weird is money talk, they are not straight forward about that and it’s hard to figure out how things are.
How did we do it:
Opening a Bank Account
Me and my partners are Romanians and we’ve set up the company online from our Bucharest office, also contacted an accounting company there to help us out. You must have a trusted accountant, like anywhere else for that matter. We exchanged emails and calls a few times and arranged a meeting.
Thinking we are EU citizens setting the bank account must be pretty straight forward. In Romania once you have the company paperwork and documents you can go to any bank and open an account. It takes 30 minutes and you have the bank account, online banking and everything else you need.
In Ireland to set up a bank account they must meet you face to face and you need to set up a meeting beforehand, so we flew to Dublin and our accountant set up meetings at several banks: Bank of Ireland, AIB and Ulster Bank. The accountant assured us that opening the bank account shouldn’t be an issue.
We got refused by the first two banks without telling us the reason or informing us what we have to do in order to get a bank account, they just said a plain NO. Ulster Bank had requested some more paper work but after a few days they decided to decline our request as well.
So we flew back to Bucharest and started looking for a solution. Actually the issue we were having was pretty common but as any problem comes with a solution. We had the idea to call a few local Romanian banks (where we are residents) and ask if they would open a bank account for a foreign company and after a couple of calls we found one, Libra Bank. This is a small bank but pretty great. We’ve set up a meeting at a downtown branch and in a few days we opened a bank account and online banking for our Irish company.
With the account we opened a Paypal account and set up a merchant account and started trading.
After 6-7 months of transactions history and statements from Libra Bank we went to discuss again with the Bank of Ireland. We met with them and they accepted and approved our bank account in the same day. Next steps were to sign the documents and that was it. Furthermore once the company account had the green light, we were able to open personal accounts with them very rapidly as well.
The most important thing is to have patience, make sure you have some funds to spend in the process or make a decision and move there, or any other actions in order to become a resident.
Now that we solved our bank account, we have the VAT issue.
Getting your VAT number
Getting your VAT number is another matter. Someone from Revenue will visit your office to discuss about your business. It’s nothing complicated but they do want to know you exist in physical space and that you are doing the business you say you are doing. They will send a letter to the address your company is registered before coming and with the letter a name and phone number of the person that will visit. You call them and set up the meeting at your office.
This means you need to have a real office, not a virtual one. So that’s an expense you need to consider monthly. You either rent a small office in a business center( which we did at the beginning) or rent something from Regus or in co-working space. Also this is the place your company minutes are held, you have the keep those there in case someone from Revenue visits.
What is that?
“Your Personal Public Service (PPS) number is a unique reference number that helps you access social welfare benefits, public services and information in Ireland.”
Once you are trading, as a company director it’s mandatory to get paid a salary and you need to be registered as PAYE, for that you need to get a PPS number to get the salary and pay taxes on that salary there. For this you have set up a face to face interview at one of the Intreo Centers, fill in a form and that’s about it.
For the most part you will need your passport, but do carry with you a driver’s license, 3-6 months bank statements and a recent utility bill.
Most of the info you need you should be able to get it from your accountant, they usually take care of everything because their getting paid of course.
Having a company in a country you visit a few times a year is not that easy but once you get the hang of it it’s not that bad.