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If a designer, architect, landscape architect or urban planner wants to conquer new international markets, this international development needs to be in compliance with the law, so it requires some control of regulatory aspects. Various support solutions exist depending on the target territories and the company’s goals.
As a partner of the Paris Design Summit, ASD Group ensures the tax compliance of the event in Paris. Its experts reveal here some key information and tips.
Company incorporation: an option to properly consider
In the context of a development abroad, several solutions are possible: the tax agent / representative or the implementation of a permanent establishment. In some cases, a company has no interest in physically establishing itself in the desired country. It is recommended to use a tax representative / agent.
If, on the other hand, its activity requires a physical presence in the target country, then the company incorporation is necessary. In this case, the formalities are multiple: administrative procedures, business plan creation, bank account opening, tax management of operations, accounting, audit, etc. Language proficiency may be required and it may be advisable to go through a trusted partner with local experience, that will ensure proper coaching and limit mistakes that can lead to various impacts at different levels of learning.
Another alternative: tax representation in the EU
In the other case, it is sometimes more advantageous for the company to do tax representation. This makes it possible to enter the European market without having premises or employees on site and without a creation of a subsidiary. All of its activity can be fully controlled from abroad. Tax representation is therefore an alternative to physical implantation. In the absence of a permanent establishment, profits earned in the European Union are not subject to income tax. On the other hand, in most cases, the company will have to identify with VAT. In this context, the tax representative becomes, on behalf of the represented company, responsible for its declarative obligations.
VAT refund in the EU
Whether or not the company is established in the European Union, the company has the right to recover VAT paid to its suppliers abroad. In order to ensure that this VAT is reimbursed as soon as possible, an analysis of purchase invoices is required to file the reimbursement request with local authorities.
Hiring abroad: more and more common practices
With the international development of many companies, the posting of workers is becoming a common practice in all business lines. Member States regulate and controls are frequent. To be in compliance with the law, the company must get information according to its activity, on the situations considered as posting of workers.
In order to hire an employee abroad, the company is not required to set up physically. It can get a representative that will hire an employee for it and will be the link between the local government and the company.
Do you have questions about a potential opening of your business internationally? Take advantage of the partnership of the Paris Design Summit with ASD Group, to ask your questions to its experts in taxes, customs and social regulations.
ASD Group, with its network of 30 branches in 25 countries, supports companies of all sizes in their international development through its company incorporation, tax representation, VAT refund and secondment of employees services.
You can find more information on their website www.asd-int.com.