[r2dnb]

I've incorporated in the UK but I kind of wonder if I made the right choice. It's a fantastic country, but one thing that bothers me and that I discovered too late - only a few weeks ago - is privacy. This is a real one, pay attention to it.

Basically, private companies are as public as american public companies. It's ok to have disclosures to make to the government, but here you also have to disclose your financials to the general public.

Basically with a simple Google Search anyone can know your turnover, your board minutes, but even - more shockingly - your balance sheet, your MONEY IN THE BANK (are you kidding me ?) and the amount you paid yourself as a director among many other things. I find this shocking for companies that are supposed to be private.

After research I've found this is due to European Regulations so it will likely be the same - or quickly be the same - no matter where you go in Europe.

For this very reason, I'd say that if you value privacy, the best place to incorporate a European Web startup is in the US. I'm gutted because I was more than happy to pay my taxes here, this is just a shame.

Then it will of course depends on your focus and your specifics. For me, I am not after exposive growth and investors money, so controlling my disclosures and my image is key to make serious deals with big clients / partners.

I hope my perspective can be somehow useful for you.

[to3m]

You forgot to provide a link :) - https://beta.companieshouse.gov.uk/help/welcome

Smaller companies (and the bar is set pretty high; see https://www.gov.uk/annual-accounts/microentities-small-and-d...) can supply abbreviated accounts. These are pretty useless for anybody looking - it's just a snapshot at year end, with no information about totals over the year. The accounts for my company provide the following details:

- Money currently owed to it [A]

- Current bank account balance [B]

- Amount it currently owes [C]

- Total share capital (also available from the annual return) [D]

- P&L - A+B-C-D

- Shareholder's funds - A+B-C

It's not actually very easy to get accurate figures from this. For a software/consulting/contracting/etc. type business I suppose multiplying A by 6-12 (assuming it's 1-2 months of income owed by clients/payment processor/etc.) is probably your best guess at estimating revenue... but if the year end was at all unusual, you're out of luck. Cash in the bank is merely suggestive, and money owed could be just about anything.

[pjc50]

> your MONEY IN THE BANK

There's a huge lag on this information: people can find out how much you claimed to have on your balance sheet at the time you last filed, which could be something like 18 months ago.

(Do US LLCs really not require you to file accounts? Why does everyone choose Delaware, anyway?)

It basically serves the same purpose as the Experian et al credit scoring system. The purpose is to protect creditors and customers against entering into contracts with fraudulent entities. Part of the tradeoff for limited liability.

I've done company creation and small co filing in the UK, all manually because the company had a nominal amount of money and was a "limited by guarantee". Fairly quick and easy.

[patio11]

Do US LLCs really not require you to file accounts

Yep! The standard for US LLCs is you disclose ownership and members, which become public records, but that's about it. A sole proprietor LLC doesn't even file their accounts with the IRS (required to produce them in the event of an audit, but the standard return won't include e.g. money in the bank or anything); a partnership return has some balance sheet items reflected but that information is private between the taxpayers and the IRS.

This contrasts to, e.g., a Japanese tax return, where small businesses have equivalent-to-US recordkeeping requirements for books but also have to submit a complete balance sheet with the return every year (along with a month-to-month revenue statement).

[SixSigma]

I'm a UK citizen. I am more shocked that the information you are uncomfortable in disclosing is not shared by a US incorporation.

Creating a Limited Company is in order to protect company owners from the debts of the company. For me to expose my company to the liability of doing business with your company, e.g. give you credit terms, I would rather like to know your financial soundness.

Society agrees to waive your debts in return for these disclosures. Personal financial ruin through business risk is eliminated through socialising the risk. This is agreed to be a risk society takes in return for an interesting economy.

[r2dnb]

I understand your point of view, at the same time when I read that :

>For me to expose my company to the liability of doing business with your company, e.g. give you credit terms, I would rather like to know your financial soundness.

I'm thinking : then we can enter into a bilateral agreement and choose an independent auditor that will certify my accounts. (Which is the idea behind the american legislation).

I really think that the government shouldn't force people to make these disclosures. It makes me very uncomfortable, as a citizen I feel my rights and my property are violated. Even at the time I'll be making 10M profit a year, I'm sorry but this is privacy, I should be free to choose with who I share this information.

And don't forget that if someone wants me to disclose but I don't, he is still free to do business with my competitor.

[rmc]

You are free to have all the privacy you want. As a sole trader. If you want limited liability, it comes with a cost.

[SixSigma]

> Even at the time I'll be making 10M profit a year, I'm sorry but this is privacy, I should be free to choose with who I share this information.

Too bad. If you want our money, that's the deal.

[throwaway41597]

In France, you'll get some of your information (name, address and line of business; financials are optional) published even if you hold personal liability. And as others have said, the public financial data is not very relevant if someone is trying to assess a company. It's also too complex for the consumer.

I think if we were to redesign the system from the start, it'd look more like Ebay with feedback and escrow. It wouldn't be enough and it'd need other protections, but my point is the current system doesn't work great neither for customers nor for entrepreneurs. And as a consequence, it may be that it stifles commerce and entrepreneurship.

[MatthewWilkes]

Private vs public refers only to the way that shares are bought and sold, corporations don't have a right to privacy. The details that are public about your company are related to the size of the company.

[desdiv]

That really depends on the jurisdiction.

For example, the stockholder, director, and officer information of a Nevada corporation[0] is not disclosed to the public. AFAIK there's no limit on a Nevada corporation's size for these privacy guarantees to continue to apply.

[0] https://en.wikipedia.org/wiki/Nevada_corporation

[MatthewWilkes]

Sorry, I should have been clearer. I was speaking about Europe, and the UK in particular.

[buro9]

I believe that this is true of all European countries and is not a trait unique to UK companies.

A UK company is cheap to incorporate, easy to manage, has little red tape, and is cheap to dissolve.

The rules are fairly clear, and you don't have to use an accountant to achieve much of the basic stuff.

You may have to use an accountant/lawyer to take advantage of SEIS/EIS relief for investors, or to get assistance with R&D tax credits, but that's about it.

[DyslexicAtheist]

if privacy is an issue open up a Luxembourg SA (société anonyme).

Compared to others Luxembourg has a good standing and no image problems combined with good banking privacy. You can sign contracts with anyone without being labelled as operating in a tax haven. Operating costs are more competitive than France. Most people speak 3 languages. Accountants & Lawyers are familiar with the law and tax code of their neighbours (France / Belgium / Germany).

But if privacy is not a problem I'd always register where my clients are. If you want to do freelancing in Germany and invoice German clients with a UK Ltd then be prepared that it is more likely that the Finanzamt will knock on your door - and if they do they will be taking a very thorough look.

[pjc50]

no image problems

It's kind of on the second tier of tax havens. Cayman/Man/Channel Islands/BVI etc are the first: incorporating there is a dead giveaway of tax avoidance. Ireland on the other hand has a low tax rate and forgiving regulators but large enough to have genuine business operations there. Luxembourg is kind of in the middle.

[ukandy]

Your accountant will also be working to make the business look as bad as possible on paper to save you tax. With that caveat, it's a tool I've used to investigate markets to see how big they are.

[sheraz]

Same is true in Sweden. Just visit allabolag.se

[me_bx]

Same in Belgium. Just visit http://kbopub.economie.fgov.be/kbopub/zoeknummerform.html and for added convenience http://data.be

(thx @unixhero)

[unixhero]

Same in Norway. Just visit brreg.no and for added convenience proff.no

[pietro]

With the added bonus that the taxable income of every private citizen in Norway is publically visible and searchable too.