Barely a first conversation with us goes by without some version of this question surfacing: what’s actually the best country to… Sometimes the sentence ends with „set up a company,“ sometimes with „relocate to,“ sometimes just generally with „pay less tax.“ There’s almost always a certain expectation behind it, as if a ranking existed somewhere, one country sitting at the top wearing a little crown, and all we had to do was read that list out loud correctly.
It doesn’t exist. It’s simply because the question itself is incomplete. It asks for a ranking, when what it should really be asking for is a function.
Where the ranking expectation comes from
Part of the blame goes to the endless „Top 10 Countries for…“ articles circulating online, usually written by providers who are only active in two or three jurisdictions themselves and shape the list accordingly. Read ten times that Country X is „the best choice for entrepreneurs,“ and at some point you start expecting exactly that phrase, from us too.
The trouble with this framing usually shows up in the second conversation, once we start asking specifics. Are we talking about the operating company actually generating revenue? A holding structure bundling shareholdings and profits? Your personal tax residency? A second or third banking relationship? Asset protection in the narrower sense, meaning structure rather than location? Or, one step further, an additional citizenship and the travel freedom that comes with it? Six different questions, and as a rule, six different answers. A country that shines on the first question can be entirely irrelevant on the fourth.
But isn’t that just a complicated way of saying „it depends“?
Fair enough, yes, to some extent. But with the difference that „it depends“ can be translated into concrete criteria, and that’s where it gets interesting. Let’s look at two entrepreneurs who both contacted us in recent months with almost the exact same opening question, and for whom entirely different answers still made sense.
The first is a consultant who works alone, with clients spread across three continents, no office, no staff, no warehouse required. What matters most to him: low operating tax burden, minimal bureaucracy, a structure he can manage remotely. Depending on his personal starting point, options worth considering include a US LLC treated as a disregarded entity, where no corporate tax applies at the US level and taxation passes straight through to the shareholder, a UAE free zone offering potentially 0% on qualifying income up to a certain threshold, or, for someone who prefers an established EU base, Ireland with its flat 12.5% corporate tax rate. The actual choice then still depends on his personal tax residency, because a low-taxed company doesn’t help much if the profits ultimately land with him personally in a high-tax country.
The second example
The second is the founder of a small consumer goods manufacturer, with her own warehouse, a handful of employees, and distribution across several EU countries. For her, the headline tax rate is almost beside the point compared to questions like customs and VAT handling within the EU, bankability with European suppliers, and substance requirements that a pure letterbox setup could never meet in the first place.
Depending on where production actually happens, a split structure can make sense here too: manufacturing in a country like Malaysia, where tiered SME rates between 15% and 24% apply depending on profit level and production costs run noticeably lower. Depending on the specific starting position and setup, a multi-year tax exemption can even be on the table there, through incentive schemes such as Pioneer Status or Investment Tax Allowance, and this is exactly where our partnership with Malaysia’s investment authority MIDA lets us support the application directly.
Alongside that, a holding company based within the EU holds the shareholding, secures direct access to the single market, and provides the reputation needed with European banks and suppliers. Even if the overall tax burden on the EU side ends up higher than in the free zone from the first example, the substance and bankability arguments outweigh that for her. Two nearly identical opening questions, two completely different answers, and both are correct in their own right.
What actually helps
Instead of the one big question, it’s worth asking a series of smaller, less comfortable ones. Where exactly does the operating activity take place, or could it take place anywhere? Do you need physical substance, meaning office, staff, warehouse, or does a lean structure suffice? How much does the reputation of the jurisdiction matter to you with banks and business partners, and how much higher operating tax are you willing to accept in exchange? Where is your personal tax residency, and does it actually fit the planned company structure, or does a mismatch develop there? And, often underestimated, how stable does the whole arrangement need to be over ten or twenty years, particularly once a family or a succession plan enters the picture?
None of these questions comes with a one-line answer, and that’s the point. Anyone looking for a one-line answer will most likely get it from someone who only earns from one particular jurisdiction and therefore only recommends that one.
When one question turns into several answers
A third example, a bit more layered, because it essentially brings the first two together. A client we’ve been working with for a couple of years runs an e-commerce business selling physical products, a small team, a warehouse in Europe, alongside a growing pool of wealth built up from recent years‘ profits. For him, there was no single jurisdiction in the end, but three building blocks, each with its own job.
The operating company stayed within the EU, for exactly the substance and customs reasons that came up above with the manufacturer. A holding company holds the shareholding, based in a jurisdiction chosen mainly for its network of double tax treaties and its banking reputation, not for the lowest tax rate. And his personal tax residency now sits in a third country, chosen primarily for quality of life and only secondarily for tax purposes, though fortunately here the two didn’t conflict.
Three countries, three functions, none of them chosen at random, but none of them „the best“ in a vacuum either. This is exactly what we mean by international diversification, not as a marketing term, but as a division-of-labour principle: each jurisdiction handles the job it’s actually strong at, and none of them has to do everything at once.
A word on the diplomacy that’s sometimes missing
We’re occasionally asked which country we’d personally recommend „the least,“ usually hoping for a bold take to bring up at the next dinner party. The honest answer is usually a letdown: countries are rarely good or bad in some absolute sense, they either fit a particular situation or they don’t. A location that’s ideal for a wealth-management holding can be entirely unsuitable for a manufacturing business with twenty employees, and vice versa. That’s exactly why we work deliberately across multiple jurisdictions rather than pushing one favourite answer onto every client.
A small caveat, in our own interest
If someone, whether an advisor, a lawyer, or an acquaintance with relocation experience, presents you with great conviction with exactly one country as the one right answer, without first asking about your operating activity, your assets, your family situation, and your planned tax residency, it’s worth at least a quick follow-up question as to why. Sometimes there really is a fitting answer behind it that the advisor simply recognised quickly. More often, though, what’s behind it is that this one particular jurisdiction happens to be what that person knows, or what they earn from. The two aren’t always easy to tell apart at first glance, which is why a second, independent opinion rarely hurts on bigger decisions.
Conclusion
The question of the best jurisdiction is understandable, it’s simple, it sounds like it comes with a clear answer. It just rarely delivers a useful one. Anyone who instead asks what exactly a structure is meant to achieve, operating activity, holding, personal residency, banking relationship, asset protection, or citizenship, gets considerably closer to the right solution than any ranking ever could. And yes, that usually means a combination of several countries in the end rather than a single answer. The good news: that’s the core of international diversification, not its downside.
If you’d like to work through these six questions for your own situation together with us, feel free to get in touch. And if you let us know beforehand which „Top 10 Countries“ article sent you down the wrong path last, we’ll read it with a certain professional interest.
