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Comment by dakiol | Hacker News Reader

Perhaps I missed it, but at what point the author sets an LLC or something similar? For me, that’s the main blocker: in Europe it costs money to start a business, some paperwork and taxes is involved, even if you don’t make a single sale. Also, for selling online you kinda have to show in your website your “business id” (or tax id or similar)… otherwise how do people know you are a legit business? For example, I’m not giving my credit card details to any random website to buy silly stuff unless they are properly identified

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Trying to do things 100% properly isn't necessarily good.

I know it's sort of a difficult shift in mentality especially for anyone with a programming background, but not doing anything at all for fear of doing it incorrectly, or delaying doing the thing because of all the setup seem much higher risks to me.

In my experience, you can just start doing the thing. It probably won't make any money anyway, in which case you can just stop. If you make some money, then you give some (say ~$1k) of that money to a bookkeeper who will then figure out how to declare it properly.

I get your fear though, as I used to have it. But this world is not like an API call that completely fails if you have one thing wrong. Instead it's people, who talk with you and figure things out with you.

Certainly doesn't in the UK, are you sure that's true where you are? Here incorporating as an ltd (limited liability) costs I think £25, but you can start a business as a sole trader without any kind of fee or registration (just a de facto status requiring declaring the income on your personal tax return).

> Here incorporating as an ltd (limited liability) costs I think £25

They've increased it to (a still reasonable) £50, I assume to help fund the new legal obligations that Companies House has been given.

unfortunately in the UK it's considerably more complicated to dissolve a company than it is to start one, even if it has few very assets and no debt

I had to fill in like 5 fields (who, what, bank account) in a 2-page form to start a basic business in Germany of all places - and was legally allowed to start operating the moment I submitted that. It cost nothing and I received a tax ID a short time later. Wasn't an LLC, but you don't need that for every little temporary thing you set up.

Setting up an LLC is not a big deal either, even if the process could be quicker. People who think that too complicated aren't competent to run a lasting business anyways. If that is hard, how are you not gonna fuck up accounting and your other legal obligations?

> For example, I’m not giving my credit card details to any random website to buy silly stuff unless they are properly identified

You might be putting more thought into this than the average person looking to anonymously send someone a bag of penis candy.

More seriously though, setting up an LLC cost me well under $1000 each in two different states. No, I don't have some elaborate tax dodge going; I moved.

In many US states it can cost at little as $200 to $300 to form an LLC. The person says they used an integrated, hosted shopping cart/checkout and payment system. This means they didn't have to go through any of the hassle of doing something like even setting up a "business" bank account, getting credit card processing services and integrating the card payment portal system into their own self-hosted shopping cart checkout workflow. Shopify is used by a bunch of very non technical arts and crafts people.

> in Europe it costs money to start a business, some paperwork and taxes is involved, even if you don’t make a single sale

not everywhere - in Poland it is fine to run a tiny-scale business without registration

https://www.biznes.gov.pl/pl/portal/00115 - among requirements, scale must be less than 75% of a minimum wage. Enough to test it.

> otherwise how do people know you are a legit business? For example, I’m not giving my credit card details to any random website to buy silly stuff unless they are properly identified

I do not care so much, as long of amounts are tiny - in case of fraud it is bank's problem

Wth? That's a great system you guys have.

On paper, yeah. Sadly the threshold is very low, and you get hit with a brutal regressive tax immediately after you pass it (obligatory lump-sum social security tax).

Oh, I am not claiming that overall system is friendly. I am paying some absurd taxes myself.

But at least "I want to test run a business idea at tiny scale, without violating law" is solved.

Not everyone shares your rigor to not buying from strangers.

Pieter Levels is a one-person show that has started multiple businesses with just a single page & a Stripe Checkout earning millions per year and I don’t believe he’s incorporated.

https://x.com/levelsio

> and I don’t believe he’s incorporated

Why would you believe that? He was incorporated in Singapore last I spoke to him. Looking back 8 years ago, to last time I bought something from him, it's from an NL company with a VAT number.

A sole proprietorship probably needs to register for VAT in EU countries after exceeding some yearly sales threshhold.

Lots of small companies (hairdressers, small shops) were not really incorporated.

A stripe account requires a legal entity of some sort behind it.

This can be a "physical person" (eg a freelance activity), depending on the country, but that still requires registration -- and if it's millions per year, it's usually a terrible idea to do it as a freelancer.

The money has to go somewhere. That somewhere needs to be banked. That banked entity needs to be incorporated, or treatable as a corporation.

> This can be a "physical person" (eg a freelance activity), depending on the country, but that still requires registration

Not necessarily. Many countries do not require sole proprietors to be registered.

> if it's millions per year, it's usually a terrible idea to do it as a freelancer.

In the US with its liability lawsuit culture yes. Elsewhere operating as a sole proprietor is not always such a terrible idea.

> That banked entity needs to be incorporated, or treatable as a corporation.

It really doesn't.

>In the US with its liability lawsuit culture yes. Elsewhere operating as a sole proprietor is not always such a terrible idea.

It's a terrible idea because as a non-American you can easily hire a firm like Appleby to evade nearly all taxes if you're rolling in millions.

It's a terrible idea because in most countries, it's much more expensive to pay yourself as a freelance than operate a corporation than can easily reinvest profits into itself.

It's not even "hiring a firm like Appleby". It's "hiring an accountant". Paying $1-2k a year to save yourself hundreds of thousands in difference.

And yes if you're hoping to process payments on Stripe, you need to be banked, and the banked entity will undergo KYB. I have no idea why you're denying this. Is this some sort of gaslighting nonsense?

> in most countries, it's much more expensive to pay yourself as a freelance than operate a corporation than can easily reinvest profits into itself.

Maybe. I've found people in my country tend to assume a corporation has stuff to spend on and/or be doing expenses fraud, and actually if you're doing things properly the all-in tax rate is potentially worse for a corporation by the time you actually have the money in your personal account.

> if you're hoping to process payments on Stripe, you need to be banked, and the banked entity will undergo KYB.

Perhaps, but you absolutely don't need to be a corporation for that. You give them your name and (personal) tax number and maybe a one-line description of what business you're in and that's that.

You don’t have to set up a corporate form to do business like this in the U.S. You can just start selling things and as long as you properly report your taxable income, you’re fine.

In France, for very small business with only you in it (and revenue cap), you can create a micro entreprise (aka micro entrepreneur / auto entrepreneur) and it's free.

It doesn't cost anything to create a simple limited company in Norway but you do have to declare the initial capital and say which bank account holds it and submit annual accounts with quarterly estimates. But that can be as little as 30 kNOK, about 3 kUSD. You can also register as a sole trader which has neither of those requirements but you are then personally liable for any debts.

Not sure if it's still the case now but you could perfectly open a Stripe account in the EU without the need for any business documents.

That doesn't make it legal to operate. In every EU country you need to register to legally conduct business activity. It used to be an expensive and long hassle but nowadays it's simple and quick, usually online and cheap.

It’s not a random website, it’s backed by Shopify!

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