With all of the talk about the Panama Papers of late, corporations and high-net worth individuals are in hot water for manipulating their money, often hiding it overseas to avoid taxes. We live in a global world where innovation is celebrated, unless it’s innovation on your tax returns.
Skip the accounting drama and choose to launch your business in a country that's already business-friendly.
Countries like New Zealand offer a better business climate
If you scored a ticket to watch all, or part of the Lord of the Rings trilogy in movie theaters, your breath was probably taken away at the natural beauty of the incredible landscapes where the films were filmed. According to New Zealand’s tourism authority, it's pretty easy to visit the filming locations and get a 360 view of the natural beauty that is Turoa and Nelson.
But there's a lot more to the land of kiwis than rugged, good looks. New Zealand is very business-friendly. Here’s why your startup should launch in New Zealand, by the numbers:
- It only takes one day to launch a business.
- A single online-portal to communicate with the government agencies necessary to launch a business eliminates the hassle of waiting for the formation documents and licenses in the mail.
- A simplified tax system sets the corporate rate at 28%. Personal above $70,000 at 33%; $48,001-$70.000 at 30%; $14,001-$48,000 at 17.5%; $0 to $14,000 at 10.5%.
Compare a country like New Zealand’s stats with the United States, which has the highest corporate tax rate in the free world (39.1%), and it’s easy to understand why some companies are actually fleeing high-tax countries like the United States; even if 'fleeing' is simply a refiling of incorporation documents.
Embrace electronic accounting
One of the major pain points for companies of all shapes and sizes includes the tracking of financial transactions and proper reporting of their economic activity to outside agencies. Many startups with millennials at the helm are opting for 3rd party electronic transaction services that offer enhanced invoicing and financial reporting capabilities. For example, PayPal allows for the processing of eCash transactions via a variety of platforms, making it a favorite of freelancers in a variety of markets.
In addition, cloud-based invoicing via services like PayPal and Square offer an automated financial tracking system. Users can login and generate reports on income and expenses based on varying periods of time.This makes gathering information for tax-reporting purposes a cinch.
Embrace flexible repurposing
If your company or startup isn't pushing the boundaries of your respective industry, you probably aren't trying hard enough. You need to look at every facet of your business and constantly reassess its purpose. Maybe the team dedicated to product development could pivot and work towards providing your products to the surrounding community in areas that can positively impact underfunded public sectors. For example, Apple provides ongoing support to a variety of schools and communities. In return, they receive a ton of goodwill and tax write-offs.