The Hidden Tax Trap for SaaS Founders in Germany | Hacker News Reader

The Hidden Tax Trap for SaaS Founders in Germany

vincentschmalbach.com

57 pointsvincent_s112 comments

There's a reasonable argument to be made whether you should be subject to capital gains in the first place. I sold my last company in the UK, and honestly the tax burden was so ridiculously low I still feel somewhat bad for it. It's crazy.

There is of course a competition problem with the high taxation in Germany; if your expected returns are much lower than in other countries your risk just increased significantly. We already have a situation where on average it's much, much more lucrative to work at bigcorp instead.

My main gripe with the GmbH though is not the amount of taxation. GmbHs are so needlessly complex it blows my mind (I'm currently running one), but that's on the side of regulations. I'd MUCH prefer if Germany worked on getting rid of silly shit like the notary requirement etc., and if taxation and bookkeeping were simplified, before we talk about lowering taxes.

I'd love to hear more about your UK exit! Most of my knowledge about UK tax rates and processes is theoretical research, so I'd really appreciate hearing a real-world experience. Did you qualify for Business Asset Disposal Relief (the old Entrepreneurs' Relief)? How was the overall process and timeline for you?

I was going to say that I'm not sure the article is quite right. While the UK does have BADR for up to £1m, it applies to individuals, not businesses. So if I sell the shares in my company or liquidate my company, I can use it. But if the business does an asset sale, there's another step: the company selling the assets. And that company has to pay its own taxes first.

If my British company sold its assets for £1m, it needs to pay 25% Corporation Tax on that. Then I could liquidate the company with its £750k remaining cash and pay 10% on that (for now, it's going up to 14% in April). This results in a total 32.5% tax, not 10%. Above £1m, it'll be even more as there's no more BADR (so roughly 40% tax total on the £1m+ chunk).

The disclaimer is absolutely right, you should consult a qualified accountant because the rest of the article is wrong. First of all, it's not just about SaaS, but all GmbH. I don't see any reason why Germany should make exceptions for software companies as the author wishes for in the second-to-last paragraph.

In regards to taxation of a sale I can only point to this first google result: https://www.rosepartner.de/besteuerung-verkauf-gmbh-kauf.htm...

In cases where you personally owned the company, only 60% of the sale price will taxed. After this Teileinkünfteverfahren the 60% are indeed subject to your incomee tax. Even better as sales are consindered außergewöhne Einkünfte their taxation will follow the Fünftelregelungen where the sale profit is spread across five years. https://de.wikipedia.org/wiki/F%C3%BCnftelregelung Realistically you'll end up paying taxes comparable to the 10~20% you can expect in the US.

Edit: Sorry, missed that part about the seller GmbH still existing afterwards. But the next paragraph I linked goes into that as well: https://www.rosepartner.de/besteuerung-verkauf-gmbh-kauf.htm... Again, Teileinkünfteverfahren only 60% being taxed.

You should read the article in full, and/or learn the difference between a share and asset deal. Your link is about the former, the article about the latter.

"You can have the shares for €4m or the assets for €5m". Both sides have agency in a negotiation.

AIUI the .de rules are intended for a somewhat different situation, perhaps more common. The article describes a situation where almost all of the exit is profit. I'm happy for you if you're in that situation, but I'd guess that most people have costs. In that case .de lets you set costs from past years against the exit, and I've heard (hearsay alert!) that .de gives you more flexibility than most countries.

All that said: if you have high income and no costs, German taxes are hard on you, it's true.

That's not how negotiations work. There is a price that the buyer is willing to pay. He is not going to pay your taxes.

In my experience, if you make someone two offers, they'll generally stop to consider which one is best for them.

Thanks for sharing that link, but it actually confirms my point. That article is about selling GmbH shares ("Share Deal"), but as explained in my post, buyers of smaller SaaS companies ($1-10M) almost never want to do share deals - they want asset deals.

Sorry, missed that part about the seller GmbH still existing afterwards. But the next paragraph I linked goes into that as well: https://www.rosepartner.de/besteuerung-verkauf-gmbh-kauf.htm...

Seller GmbH sells their assets, profits are taxed accordingly. Only when taking that profit our the individual is taxed but as I mentioned above the Teileinkünfteverfahren, only 60% being taxed.

Okay, so they don't want to buy the obligations. Why should the German state encourage and subsidize that behaviour?

The headline is a bit sensationalized: the article focuses exclusively on small SaaS exits, which are usually done by selling assets, NOT the whole company. In Germany, these sales are treated like any other business income.

If you're aiming for a normal exit - where you actually sell the company - things are much more favorable.

You need to set up a holding company, which is usually a UG. This is easy and cheap: there is a simplified process for it ("Musterprotokoll"), and it requires no upfront capital like a GmbH. As of recently, it can be done online without having to visit a notary in person. The overhead is negligible.

Once the holding sells its subsidiary ("share deal"), in most cases, the effective tax rate at the holding level is only ~5% due to § 8b KStG. This is not bad at all, since you'll want to reinvest most of the money anyways.

There are gotchas in every jurisdiction, and you need to get professional advice by a local accountant. Germany is a fine place to run a business. If you already live here and don't want to move your family for tax reasons, you don't have to.

I made a rather stupid mistake recently, as an American. I put $30k or so of my Roth IRA into BMW stock, since it was paying something close to 8% annual dividends. Once a year. I suppose I should have looked at this more closely. When the dividend was paid, the German government took about 30% of it right off the top in taxes... for a foreign investor. Still not a bad return, but I won't be buying any German stocks going forward.

That's my Yelp review of investing in German businesses, if it helps anyone. I've had more or less the same experience dining in Seattle and accidentally tipping 20% on top of an included 20% tip that was already included but not specified in the bill.

FWIW it’s the same thing if you buy an American stock from a EU country, the dividends are taxed in the US.

That why global index funds are probably the best way to invest for non-professionals

I spent some time trying to learn about investing as an average person, and from what I understood, the entire knowledge could be summarized into "pick your favorite global index fund and hold"

The EU stock exchanges withhold the most aggressive dividend tax disregarding bilateral agreement with country of your tax residence. If you think that German 26% is bad, the Swiss withhold 35%.

I had assumed that if I were a German citizen, I'd probably pay the same amount in taxes on that dividend. Would I actually pay less?

Sorry to "but actually" you, but that is just because you did not claim the treaty benefits. Pedantic, it is also 26%, not 30%.

You should be able to get 15% tax on dividends, which also count towards your US taxes which you stil have to pay.

It is also exactly the same for foreign investors from Germany investing in US companies. We have to file a W-8BEN, otherwise the US takes 30% on dividends and even on capital gains!

Is that true if it's in a Roth?

Not from US, so can't comment on what it does for tax credit, but the treaty benefits should still apply.

Also, you should've mentioned that in your OP. Why would a foreign country's tax system care about another country's tax-advantaged investing account?

The tax withholding is seperate from any home countrystax obligations, if that helps to understand it. There are treaties to avoid double taxation that then allow claiming these unavoidable taxes at your tax residency. If you don't pay taxes there, usually you're out of luck.

You're probably entitled to get all of that back due to double tax treaties.

You just need to file for a refund.

> You just need to file for a refund.

FORGET ABOUT IT. You'd have to send traditional letters back and forth between your local tax office and the tax office of the dividend origin country. Usually the foreign tax office demands their form be rubber stamped by your local tax office. Obviously your local tax office will not rubber stamp a form by foreign tax office in a foreign language, but they don't care.

Tricky, maybe, because it was bought in a Roth IRA - which is not taxed. And therefore, I think, not eligible for tax refunds. I probably should have bought it in a normal trading account.

You can get it reimbursed in some cases.

You know that US taxes the same 30% on dividends for non-residents, right?

I didn't know that, but it sounds like a terrible policy.

I'm German and had a startup in Germany (standard UG holding + GmbH).

My one advice to anyone thinking of starting a company is: don't do it in Germany. Tax burden, insane bureaucracy and a conservative, tech adverse local market put you at a disadvantage against UK/US peers.

>German founders are incentivized to move abroad before exits

Don't do that. The tax office will treat that as a sale and will tax the current valuation at 20%.

As someone who has run a small business in an EU country for 10 years and is in a process of relocating to a low tax jurisdiction I wonder what EU's endgame on this one is.

It's not like EU countries offer a potential founders anything of substance. You can just as well run your company from abroad. Most of your customers are going to be outside of EU (most likely), you will be buying services from outside of EU, hire/work with people from various countries. There is just no reason to be in Germany, France, Spain, Italy when you don't get anything but bureaucracy burden and high taxes.

I paid my (admittedly quite low by EU standards) taxes honestly but right now savings on capital gain tax alone are enough for me to buy a beach house in a country with a better weather and still save some. My country wants to charge >1% of my wealth every year just to be there not even going into business taxes. The incentives are right there to leave. If I ever start another business it will be in my new tax friendly country. A lot of people are like me and will realize what terrible deal they are getting. Out of those who stay a smaller number is going to be successful because of all the tax/bureaucracy burden. Is the endgame to just give up on IT? Introduce tariffs on everything? Forbid foreign corporations to sell in EU?

I just don't see how EU isn't going to be left in the dust in technology sector with their current policies.

Which country did you move from and which did you move to?

This is a lot of words trying to explain that in Germany the system is designed that poor remain poor. First 40% of gross salary on contributions, then 30% of net salary on rent. Dynasties with their VW-Porsche-VW-Porsche quadruple currywurst burger-sandwich need the society to be poor.

More like the system wasn't set up with the expectation that people will become rich by creating a SaaS and selling it, because it predates those concepts by at least a few decades.

Porsche, Siemens, Krupp, Thyssen, Bosch were all startups back in the day, just in hardware

>Porsche, Siemens, Krupp, Thyssen, Bosch were all startups back in the day, just in hardware

Yeah and they all got big and wealthy by exploiting laws, loopholes, state subsidies and even slave labor back in their days. Let's not pretend the German industrialists from 100 years ago who started those businesses were some patron saints and beacons of legality and morality.

I was working for a big German scrap metal business a while back and during the Christmas party the CEO got so drunk he started bitching how much better it was in the past when he could engage in corruption and tax fraud to grow the business without being caught compared to today when this isn't possible anymore.

None of those companies you listed could have gotten remotely as wealthy in the legal and regulatory environment of today.

At least we still have inheritance tax, though it's somewhat broken for those you mentioned who are far too good at avoiding that tax.

Yeah the Lichtenstein based charities and trusts are very afraid of your inheritance tax.

I love countries that only exist as tax loopholes. Every time one disappears, another one pops up. Supply and demand.

Regulation, Taxes, inflexibility and small-thinking mindset let me leave Germany 10 years ago. I didn’t regret it a single day and everytime I’m going back home after visiting my parents in Germany I feel so much more free.

Where did you go?

Incidentally, in a neighboring EU country (Poland) the tax system has a bizarre nod towards solo entrepreneurs running a SaaS: you can choose simplified revenue-based taxation and fall into the 8.5% bracket.

8.5% tax on revenue is really good. And this is very specific: it applies specifically to SaaS businesses, most revenue-based rates are higher.

If you decide to sell your business, assets are taxed at 3%.

Poland still has tax friendly system towards self employed people. Usual deal you get is 19% tax (recently raised to 23.5%) so you avoid double taxation as a company (where you first pay corporate tax and then income tax or capital gain tax as an individual). This makes sense as you don't enjoy privileges of limited liability. Somehow most other countries have it backwards though.

The 8.5% thing you talk about is not really that great (it's revenue based so it's out once you have significant costs/partners you pay). It's done to simplify accounting. It only makes sense for small one person companies and it makes sense to incentivize people to start businesses - a wild concept in Germany (or most of other EU countries).

> The 8.5% thing you talk about is not really that great

I would be inclined to disagree — it is absolutely wonderful for solo entrepreneurs. You might say "it only makes sense for small one person companies", but that's exactly what my business is and intends to be.

You can easily run a SaaS business with 90%/80%/75% margins (gross/operating/net), which I think is really hard to beat anywhere in the world.

For people who want to stop working for "the man", become in control of their lives and earn money from a SaaS business, this is great.

And how many brilliant startups Poland bred? Poland is post-Communist state where you're at the mercy of a clerk, disfunctional courts, and bloated buggy IT systems.

CD Projekt Red?

They are older than Google, launched in the first half of the 90s. They bootstrapped in fiscal and political realities incomparable with those described three comments above.

If you ever plan on selling your company you’d do well to have it wholly owned by a holding company (which in turn is owned by you).

…if you plan to sell your company.

That's exactly the problem - you often don't plan to sell from the start. Life changes. Kids are born. Health issues emerge. New opportunities arise.

If you start successful in Germany without the right structure, you're locked in. At least if you plan to sell from day one, you have options (expensive ones). But most bootstrappers just build stuff users want. Then one day they get an interesting acquisition offer...

...and discover they've accidentally built a tax trap that'll cost them millions. No way out at that point.

You're paying the same amount as if you had been employed and earned as much as you're selling your company assets for. If that costs you millions, you're still having millions left.

Please take note that his specific situation is not selling a company - which would qualify him for a reduced tax burden, but selling assets as a private person.

I am unsure if this would be taxed differently in any other country.

In the UK it also is ~20% capital gains tax when you are just equity holder /employee instead of the actual business owner. While the owners with the same class stock can get 10% instead.

The Germans aren't wrong to see it as income from work though, because software is an example of crystallised work.

This is why it has had unfavourable treatment in Europe. If you allow people to build software and sell it for capital gains rates, then if you're consistent you allow people to build anything and sell them for capital gains rates, which means that the 'real' tax on labour if you structure your work as leading to something which can be sold, is the capital gains rate.

This is the problem for software in Europe: when you tax work, the one who build something through work retains a smaller fraction of it, so he has less money to invest in expanding the work.

> software is an example of crystallised work.

Yes, but if the software was written by salaried employees then this work has already been taxed.

Say if you buy stocks, then sell them at higher price, one could argue that it's someone's work that made them cost more.

Yes, which is why this only matters when the person in questions works in the company.

In the Swedish system there's a rule whereby you accumulate something based on wages paid, and where you can thus avoid part of the sale counting towards income, provided that you've paid people so much in salaries that your work can be seen as a small part.

What I'm sort of arguing for though, is to tax work less, so as to encourage it.

The software aspect is quite irrelevant, and I believe that what is described is simply how GmbH companies work. If you own a company and sells it, what you are doing is selling your shares in the company. In many jurisdictions this is capital gain (or loss) for accounting and tax purposes since you are selling an asset. Ultimately I suppose the issue is the tax rate, not the "implementation details".

But often there's a special rule when you work in the company in question, in which case you have to pay income tax on a certain fraction of dividends, with something similar for the sale of the company.

We're not talking about dividends here but about selling shares, which is completely different.

Yes, but in order to prevent people from bypassing the rules similar rules almost always apply to sales. It's a system made to ensure that income from work is taxed as work, whether you extract the money by dividends or through a sale.

For example, in Sweden we have a set of rules called 3:12 rules, which govern people who simultaneously own parts of a company and also work in it. In Sweden we have an exemption for large sums, for which ordinary capital taxation rules are applied, and the German law is very similar, only with a much higher exemption.

> Structure larger exits through international holding companies (complex and expensive)

Setting up an LLC in a low-regulation US state is simple and inexpensive.

This is not as easy as it sounds, either way really. You very quickly get into tax evasion, whether you know this or not (which is not an excuse). A lot of people I know (I know almost only entrepreneurs in my friend circles) have companies elsewhere (outside the EU) for this reason; most of them are <<1m$ / year companies and those companies almost exclusively are not legal here IF someone would find out. You cannot open an offshore (US/Belize/HK/SG/whatever), pay legal taxes there and that's it; if the gravity (decision power) is in an EU country, you are running a defacto local company for the taxes and you need to pay the taxes you would pay on a German company if in Germany and then figure out how to fix the US taxes with that, creating a huge mess.

Of course they usually won't find out (no-one is going to check for a few 100ks/year), but it's not legal. To do it properly, you need multiple people as shareholders who do not live in your country and who have the decision power, or at least you definitely don't have it alone. So if you have someone in Mexico, someone in Thailand and you in Germany, and decision power/shares is 1/3rd for all, you'd be fine. But you in Germany with 100% ownership of a Delaware company is not something you can do unless you pay GmbH taxes, in which case, what's the use? Well, I guess if you are looking for US VC money, that might be a use case for it even though you pay defacto GmbH taxes.

> You very quickly get into tax evasion, whether you know this or not

I don't understand where you got tax evasion from my comment? US LLC's are pass through entities by default. All income from the LLC directly flows to the GmbH which pays the normal tax rate in Germany.

When the time comes to sell, transfer of the LLC is a share deal which avoids the downsides of the asset deal which TFA describes.

> I don't understand where you got tax evasion from my comment?

I didn't say you did, I said that many people (as I see from experience every day) think it's fine to just easily and cheaply open a company somewhere (as you did say) else and then follow their tax rules and that's it. And that's not true.

You didn't quite mention you intended this in conjunction with a GmbH, so it sounded like 'quick and easy offshore' which I was responding to.

Also, depending on the ownership / structure of this xmas tree, you might still not quite benefit from this as you think. It's complex matter and many people just do it without giving it too much thought. Which works if things stay small-ish.

> You didn't quite mention you intended this in conjunction with a GmbH, so it sounded like 'quick and easy offshore' which I was responding to.

I quoted the part of the article that was describing a dual company structure.

Ah, I didn't read that from it, apologies.

True, creating a Delaware LLC is simple, but that doesn't solve the tax problem. Management decisions from Germany mean German tax liability, regardless of where the company is registered. The only way to benefit from US tax rates would be physically moving there - just having a US company adds complexity without fixing anything.

> but that doesn't solve the tax problem

It solves the tax problem that TFA is talking about i.e. it makes selling the SaaS a share deal instead of an asset deal.

If you mean taxes in Germany are generally too high, that is an entirely separate discussion.

Fun fact: Before Trump's tax cuts, the US corporate income tax rate was higher than in Germany.

Being an US business makes things complicated in Europe. Especially banking is very eager to understand every single US associated transaction to your account.

I guess my comment was not clear without the context from TFA. I was specifically talking about the dual company structure i.e. the GmbH owns the LLC.

For a German business, setting up a holding company in Estonia would be much better. Still in the EU, no onerous American reporting requirements, everything is fully online and cheap, and taxes aren't super high (20% capital gains, up to 7% on dividends if I'm reading things correctly).

> no onerous American reporting requirements

I'm sorry but US LLC reporting requirements are not onerous in any sense. Hell, some states like Arizona have no annual reporting requirements at all.

When opening a bank account in the EU, you get asked if you're an American fiscal resident in some sense (citizenship, US-based LLC). If you are, either they refuse you entirely, or they ask you to jump through extra hoops because they are forced to report to the American tax authority (IRS) everything about you due to American regulations.

I misunderstood your comment, you meant FATCA compliance.

But why would the US LLC need to open a non-US bank account?

Also, a US LLC wholly owned by a foreign company is a disregarded entity for income tax purposes. It is not considered a US fiscal resident.

Disclaimer: Not a tax professional, but have had a few businesses.

Why are you calculating the US/UK/AUS as sale of a business, and the german one as sales of an asset owned by the business?

One is profit of the business, and therefore subject to additional taxation before before distribution of funds, the other isn't. Thats why your figures are so different.

Even in your examples where they would buy the whole company, if they then wanted to roll the assets into their own company in any way, the tax liability would still exist. So all that happens is the burden moves from you to them (no doubt they would do it as efficiently as possible, but there is still a liability).

If you are selling the sole asset of your business at what you deem the same value as the whole business, then you clearly aren't accounting for the business liabilities. Account for that, and then you will be equal again.

I have shares in a bootstrapped Gmbh via a holding company. Germany is a complex place to do business for non native speakers and it is generally financially risky to do business here. But if you structure it right, the flip side is that Germany has a lot of family owned smaller and larger businesses. The economy kind of runs on companies like that. So, it is definitely possible to be an entrepreneur in this country.

I don't actually mind paying taxes (to a point); I think there's a fairness in wealthy people doing their part for supporting the society they are a part of that supports them. What I do mind is the incentive structure in Germany is geared towards discouraging people from being entrepreneurial, taking calculated risks, and generally trying to do new things.

You take on a lot of personal risk when you found a company here. You are dealing from day one with greedy accountants, endless bureaucracy, a tax office that wants to squeeze you before you even have any revenue, etc. I'm bleeding cash via my holding company that's effectively running on my savings. This thing serves no purpose other than to insure me against potentially succeeding and not bankrupting myself in the process. Success here would be me generating a lot of tax income, employment, etc. I.e. things that most economies would regard as rather desirable things.

The whole point of limited liability companies in other countries is to de-risk the process of creating new businesses for individuals so that people might do innovative things that benefit the economy. Germany does the opposite. It actively discourages people from doing that. And a Gmbh actually exposes you to a lot of liability.

Bootstrapping means you take a lot of opportunity cost. For example by taking no or a very low salary. So the tax office creaming off profits before you even had a chance to pay yourself is not helpful. That's literally a situation we face now. We've been inching closer to break even this year. We went from the edge of bankruptcy to having a bank account that is able to sustain us well into next year in the space of a few months. This has been a long journey of about four years. We've had part of the German bureaucracy trying to support us and other parts of it doing their best to frustrate that. It's internally conflicted on this.

The situation does not compare well to some other countries in Europe where this stuff is a lot easier, less risky, has way less friction, and takes way less time. Though in fairness, lots of EU countries have their own unique challenges for trying to do business.

Some Germans get really defensive on this topic. But the fact is that Germany is bordering on a recession right now and it needs the next generation to step in the vacuum of the retiring baby boom generation and its imploding car industry. And that's before we start talking about its crumbling infrastructure, high energy prices, etc. Germany has economic issues. And the fix for many of those issues is for it to invest. And not in its dying industries but in new ones that can replace them and the infrastructure to support the economy. Which includes its legal framework. The trick is investing efficiently and effectively. And it's not currently able to do that.

The #1 thing holding that back is the German rules, bureaucracy, counter productive rules and policy, etc. Easy to fix on paper. But that requires a change in attitude here. Apparently we have some elections coming up. Maybe some change is possible.

Interesting post.

>> The whole point of limited liability companies in other countries is to de-risk the process of creating new businesses for individuals so that people might do innovative things that benefit the economy. Germany does the opposite. It actively discourages people from doing that. And a Gmbh actually exposes you to a lot of liability.

Can you elucidate what you think the philosophy or psychology is that drives this kind of anti-risk-taking attitude or, as you said, why "Some Germans get really defensive on this topic"? It sounds cultural rather than logical. [edit: My first guess would be that it's a product of a social welfare state, overly secure in its benefits and redistribution of wealth in the most generic sense; but sometimes I've observed some other types of self-assured blindness to simple reality in Germany that I suspect have something to do with it, and that's what I'm curious about].

It is definitely a weird cultural thing. I can speculate a bit.

It might have some roots in social well fare. But I've also lived in Sweden and Finland which have a very different attitude towards building tech companies. Especially Finland is quite successful at doing startups and scaleups. Especially considering its small population. And of course both countries have a strong social well fare culture. And Germany is actually fairly conservative on the spectrum. E.g. minimum wage did not even exist here until fairly recently. State pensions aren't that great, etc. I'm from the Netherlands originally, our social security is a lot better and more efficient. And so is our economy, infrastructure, healthcare system and all the other things that are clearly very broken and neglected in Germany. It's very visible when you cross the border. The state of the roads is very different on both sides of the border. That's true for most countries that border Germany.

Germans just seem very reluctant to change anything. There's a lot of hesitation doing anything. That's also why their infrastructure is such a mess. Big investments are risky. So they prefer not to. Their default attitude to almost anything is "no". Modernizing anything is frowned upon. So they still bank like it's the nineteen eighties, which is stupidly annoying. They stubbornly stick with a lot of paper based processes. And they employ a lot of pencil pushers, accountants, lawyers, etc. that actually rely economically on things not changing.

And of course they refuse to modernize rules that flat out barely make any sense. It's always been this way, it can't be that bad, etc. They are very proud of keeping their national debt low. But that also means they've been neglecting their infrastructure for decades. Which is now affecting them economically.

The way out would be massive investments. But that requires changes they are not comfortable making. So they are just dilly dallying and going around in circles.

With startup culture, their own rules are stopping foreigners from investing in their german companies. Too hard. too risky, etc. That's irrational. They should be welcoming that cash. Not putting up lots of obstacles. That money would go directly into their economy. But instead it's going elsewhere. Lots of German companies with their headquarters in Amsterdam, Dublin, London, etc.

It's surprising to me that Germany isn't at the forefront of incentivizing an agile startup economy in any way possible. Especially as they've always been the economic powerhouse of Europe, failure to get ahead of these global trends is surprising. And this is the first time I've ever heard anyone describe Germany's infrastructure as anything below world-class, although it's been ten years since I've been there now. The idea that the roads would be rougher than those in the Netherlands is fairly shocking. I do think it's a great teller, though. I live in Oregon where the roads immediately degrade when you cross the border from California; and I used to live in Argentina, where the roads degrade when you cross from Chile. The feeling you have crossing one of those borders says quite a bit about what's happening in the place.

Thanks for your honest reply.

germany made a few strategic mistakes. one is allowing NIMBY attitudes to prevail to gain votes, which slows infrastructure development to a crawl, and another very specific is to not build a dedicated high speed rail network, instead believing that high speed tracks can be shared with other rail.

Move to Belgium and get a whopping 0% capital gains tax

Is there actually any sane country to do SaaS business except the US? It's insane how easy it's to start an LLC in US, set up a bank account, do your taxes, without ever leaving your home. Hell, you can start it as a foreigner, opt for pass-through taxation, and pay taxes at your tax residence.

I mean, I get higher taxes, I just don't understand why you want to make it so hard to start and operate a company.

Poland is not terrible. You can do most bureaucracy online. Things that require you to visit a government office can be usually done in a day and there is not much waiting. Taxes are lower than Western Europe still (although pressure mounts to increase them). Courts are slow and incompetent but there is not that much litigation in EU anyway so it's often not a problem.

When it comes to taxes you pay 19% corporate tax (9% for small companies that bring less than 2M EUR revenue a year) and then 19% capital gain tax. If that's a lot or not I will let you judge. There are other low tax options in EU if you are willing to travel.

> It's insane how easy it's to start an LLC in US, set up a bank account, do your taxes, without ever leaving your home

All of this is very simple, cheap, and quick in the UK, too.

Fully agree that it is difficult to understand why so many countries make it so complex and costly to set up and run a company...

in USA its qualified small business so tax is 0

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