Guide to becoming a self-employed expat in the EU
The United Kingdom was once described as the ‘self-employment capital’ of Western Europe, with many people choosing to start their own business, or work as a freelancer or contractor in their given trade.
As self-employment continues to rise, so too does the number of British expatriates who continue to work for themselves after a relocation. There are a lot of reasons why self-employed workers may make the decision to move overseas. For example, a successful UK-based business could be ready to open a new office abroad to expand its client base. Or maybe a contractor is looking for a better work/life balance, while continuing to practise their skills in another country. Some expatriates who are currently employed look to moving away with the specific aim of setting up a new business venture or working freelance in a country where opportunities are available.
Whatever the path, being a self-employed expat takes a lot of organisation and preparation to ensure that the move is a success. There is already a lot to consider when relocating, such as finding a suitable home, researching schools and childcare, sorting out healthcare, and so on.
Staying within the EU has a lot of perks for self-employed workers. The commute back to the UK is relatively short, and in general business practices are fairly similar. However, depending on the choice of location, there could be significant tax benefits, a lower cost of living, as well as a higher quality of life.
Things to consider
Contractors in some trades are in demand in certain EU countries, which makes finding regular work easier. It is worth researching a choice of countries to see where skills are in short supply. For freelancers who work remotely via the internet, such as writers and web designers, then as long as the internet speed is good, the choice of location is far more open. Thorough research into chosen countries should include things like checking the cost of living, necessary supplies, hardware, technology, services (for example broadband), office rental, wages (if hiring local employees into the business), etc. This helps to work out a budget and potential income for the business to ensure that the move is viable.
Also, look at the economic future of the country; some are more stable that others and this should help to give an idea of sustainability for any venture. It’s also essential to look at the tax situation, and factor this in.
Where to move
So where are the best places to consider working self-employed in the EU? It’s not always the countries that first come to mind. For example, Montenegro often crops up as a good option due to its ease of commuting, along with very low tax rates and few limitations on new businesses. It does, however, have very slow internet speeds, which would be unsuitable for certain industries.
Spain is a popular option, due to its close proximity to the UK. There are three million self-employed people in Spain, called autónomos, and it’s a fairly easy and straightforward process to set up as a self-employed worker. Apart from getting a foreigner’s identity number (NIE), anyone can set up as a freelancer or start a business when they are expats from an EU country as a sole trader or a limited country.
Other countries, like Germany, make distinctions between trades (producing goods, for example) and ‘liberal professions’ such as lawyers, writers and so on. This is important, as it determines how businesses are registered and the tax situation.
With the right outlook, vision and time spent researching, being a self-employed expat could be the best decision and a profitable one too.
Information correct at the time of publication.