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In 2025, according to estimates by the European Commission, the average tax burden on businesses across the EU will remain at 21–23%. However, the difference between countries exceeds a threefold gap. While some jurisdictions are tightening control and introducing new requirements for substance and tax transparency, others continue to offer attractive conditions for international companies and investors. According to KPMG and PwC, more than 60% of entrepreneurs planning international expansion are considering registering their business in European countries with low taxes — and this trend is only growing stronger.

Today, I want to share a practical guide based on the experience of COREDO, which will help entrepreneurs and executives choose the optimal jurisdiction, minimize tax risks, and implement an international tax planning strategy. If you are looking not just for a list of low-tax countries, but for an in-depth analysis that considers the nuances of substance, compliance, and long-term consequences for business — I recommend reading this article to the end.

Countries with low taxes for business

COREDO’s experience confirms: registering a business in the EU with low taxes provides not only direct savings but also strategic advantages for scaling and entering new markets. Key benefits include:

• Tax optimization in Europe: Reducing the effective tax rate allows companies to reinvest more funds into growth, R&D, and marketing.
• Tax advantages for entrepreneurs: In a number of countries, tax holidays, investor benefits, and incentives for startups and IT companies are available, significantly lowering entry barriers.
• Flexible tax regimes for foreign companies: Many jurisdictions offer special statuses for tax residents and non-residents, allowing optimization of international capital flows.
• Access to investment programs: Some low-tax European countries offer investment programs for entrepreneurs, simplifying the process of obtaining residence permits and citizenship.
• Tax incentives for startups: COREDO’s program for supporting technology companies has shown that preferential regimes allow businesses to scale quickly without excessive tax burdens.

Thus, registering a business in low-tax countries is not only a matter of direct savings but also of effective company positioning in the global market. Next, let’s look at the requirements for substance, AML compliance, and tax transparency.

Substance requirements, AML, and tax transparency

However, the choice of jurisdiction with minimal taxes for business is always linked to a number of challenges. International standards (OECD, FATF, EU) are tightening requirements for substance — the real economic presence of a company in its country of registration. Insufficient compliance with these requirements may lead to the loss of tax benefits, additional assessments, and even removal of the company from the register.

• Substance requirements: The need for offices, employees, and management decisions within the country. COREDO’s practice shows that many clients underestimate these requirements, leading to tax disputes.
• Compliance (AML/KYC): Stricter monitoring of beneficiaries, automatic tax information exchange (CRS), and mandatory transparent ownership structures.
• Tax transparency: Low-tax countries are increasingly integrating into the European system of automatic data exchange, which requires impeccable compliance and reporting.
• Tax risks and minimization: It is not enough to simply register a company; it is important to build a structure resilient to tax audits and inspections.

Solutions developed by COREDO allow not only the selection of an optimal jurisdiction but also ensuring compliance with all current substance and compliance requirements, minimizing long-term risks.

Therefore, when choosing a country for business registration, it is important not only to consider tax rates but also to analyze in advance the current conditions for meeting substance and compliance requirements.

European countries with low taxes for business 2025

Based on an analysis of legislation, practical application of tax regimes, and client feedback, the COREDO team highlights five European countries with the lowest business taxes in 2025. For each, we will review corporate taxation features, substance requirements, compliance rules, and additional incentives.

Corporate income tax in Bulgaria for companies

Bulgaria consistently ranks among the top European countries with minimal corporate tax. The corporate income tax rate for companies is 10%, with additional incentives for small enterprises. Key features:

• Simple company registration in the EU with minimal taxation: the process takes 1–2 weeks, with a symbolic minimum share capital.
• Tax treaties and double taxation agreements in the EU: more than 70 agreements, including with Asian and CIS countries, helping to avoid double taxation.
• Tax incentives in Europe: special regimes and reduced social contribution rates for IT companies and startups.
• Substance requirements: moderate, sufficient to have an office and a local director.
• Compliance: EU standard, automatic information exchange, transparent reporting.

COREDO’s practice has shown that Bulgaria is an optimal choice for companies targeting the EU and CIS markets, where simplicity of doing business and predictable taxation are priorities.

Minimum corporate tax in Hungary — 9%

Hungary offers the lowest corporate tax rate in the EU — 9%. This is a flat tax applied to all types of business activity. Key features:

• Tax incentives for startups: innovation support programs, grants, and accelerated licensing procedures.
• Benefits for IT companies: reduced rates on intellectual property and accelerated depreciation.
• Corporate tax for foreign investors: no separate registration required for non-residents, remote submission of documents is possible.
• Substance requirements: moderate, but since 2024 there has been increased focus on real presence.
• Compliance: EU standard, with a high level of automated reporting.

The COREDO team has implemented several projects for technology companies where the Hungarian jurisdiction made it possible to reduce the tax burden and simplify compliance procedures.

Business taxes in Montenegro — 9%

Montenegro, while not an EU member, maintains one of the most flexible tax systems in Europe. The corporate tax rate ranges from 9% to 15%, depending on profit levels. Key features:

• Benefits for expats and investment programs for entrepreneurs: simplified residence permits and tax holidays for new companies.
• Tax incentives for attracting capital: special regimes for startups, minimal substance requirements.
• Substance requirements: low — a legal address and a nominee director are sufficient.
• Compliance: moderate, although from 2025 stricter monitoring of beneficiaries is planned.

A COREDO case study for a fintech startup showed that registering a business in Montenegro enables rapid entry into the European market with minimal compliance and maintenance costs.

Corporate tax in Andorra 2025: 10%

Andorra is a unique jurisdiction with one of the lowest effective rates for holding structures in Europe. Key features:

• Corporate tax 10%, for holdings as low as 2% — provided substance requirements are met.
• Tax regimes for holding structures: attractive to international investors, with minimal dividend taxation.
• Tax privileges for investors: opportunity to obtain residency permits, benefits for new companies.
• Substance requirements: high — a full-fledged office, employees, and managerial control are necessary.
• Compliance: strict, especially for financial and investment companies.

A solution developed by COREDO for an international group reduced the effective tax rate to 2% while fully meeting substance and transparency requirements.

Tax benefits for business in Malta

Malta is a leader in the number of double taxation treaties and has a unique tax refund system. Key features:

• Nominal corporate tax rate — 35%, but effective rate 5–10% thanks to the refund system for foreign shareholders.
• Regimes for holding structures: exemption from tax on dividends and capital gains under certain conditions.
• Business tax benefits: startup support programs and tax holidays for new companies.
• Substance requirements: high — a real office, local director, and employees are required.
• Compliance: EU standard, transparent reporting, and regular audits.

COREDO’s practice confirms that for international holding structures and companies working with intellectual property, Malta remains one of the most advantageous and predictable jurisdictions.

Comparative table of tax rates and business conditions in 2025

Tax benefits for businesses in low-tax countries

Tax incentives for IT companies, startups, and investors

In 2025, tax incentives for startups and IT companies are becoming a key factor when choosing a jurisdiction for registering a low-tax business in the EU. For example, Hungary offers a flat corporate tax program, and innovative companies can access grants and subsidies. In Malta and Bulgaria, tax holidays and reduced rates for new enterprises help minimize the tax burden on small and medium-sized businesses.

COREDO’s practice shows that for technology companies, tax incentives for IT firms, accelerated depreciation opportunities, and exemptions from capital gains tax are particularly important. In Montenegro and Andorra, investment programs for entrepreneurs and favorable tax conditions for expats make these countries attractive to international investors.

Specifics of dividend and profit taxation for foreign owners

The effective tax rate for international companies depends not only on corporate tax but also on the taxation of dividends. In Andorra and Malta, dividend tax for foreign shareholders can be reduced to 0–5%, provided substance requirements are met and double taxation treaties are in place. In Bulgaria and Hungary, the rate on dividends for non-residents is 5–10%, while in Montenegro it is 9%.

The COREDO team recommends that when structuring holding companies in the EU, one should consider not only nominal rates but also the tax implications for international investments, as well as the availability of double taxation treaties.

Business registration and tax residency in the EU

Substance requirements and economic presence

In 2025, substance requirements are becoming increasingly strict. To obtain tax benefits and resident status in the EU, it is important to ensure real economic presence: an office, employees, and managerial decisions made within the country. Failure to meet these conditions may result in the loss of tax advantages and additional assessments.

• Documentary proof of substance: office lease agreements, employment contracts, and local managerial control.
• Compliance (AML/KYC): a transparent ownership structure, disclosure of beneficiaries, and regular reporting.
• Tax transparency: readiness for automatic exchange of tax information (CRS).

Company registration procedure, account opening, and compliance

Company registration in Europe for tax optimization purposes requires strict adherence to procedures:

• Preparation of documents: charter, information on directors and shareholders, address confirmation.
• Application submission to the register: in most countries this is done online; registration takes 3 to 10 business days.
• Opening a bank account: substance confirmation is required, sometimes the director’s personal presence.
• Support and compliance: costs for support and compliance in low-tax countries are usually lower than in “expensive” jurisdictions. At the same time, it is important to consider expenses for audits and tax reporting in the EU.

COREDO’s projects in Bulgaria, Hungary, and Malta show that well-structured corporate frameworks in the EU allow minimizing tax risks and ensuring long-term business sustainability.

Tax risks and trends for business in Europe 2025

How tax regimes and rates are changing in Europe: should we expect tightening?

In 2025, EU tax reforms are aimed at increasing transparency, combating tax evasion, and harmonizing tax infrastructure. Expected developments include:

• Stricter substance requirements: more countries are introducing mandatory real offices and employees.
• Increased tax burden on small and medium-sized businesses: in some countries, higher social contributions and a minimum corporate tax are under discussion.
• Tougher compliance: stronger monitoring of beneficiaries, automatic tax information exchange (CRS), regular inspections, and audits.

COREDO’s recommendation: when choosing a jurisdiction, focus not only on current rates but also on expected legislative changes to avoid unforeseen costs and risks in the future.

Long-term risks of choosing a low-tax jurisdiction

Choosing a country with minimal corporate tax for an international company always involves certain long-term risks:

• Risk of tax rate changes: in 2025, several countries have already announced reviews of preferential regimes.
• Stricter control over substance and compliance: insufficient adherence to requirements may lead to loss of tax residency and additional assessments.
• Reputational risks: using “aggressive” schemes may negatively affect access to banking services and investments.

COREDO’s solutions help minimize these risks through a comprehensive approach: thorough legislative analysis, building transparent structures, and continuous monitoring of changes.

Practical recommendations for business

Practical steps for choosing a low-tax country for business

Based on COREDO’s many years of experience in international tax planning, the following algorithm is recommended:

• Define your strategic business goals: scale, industry, client geography.
• Compare effective tax rates and incentives: do not limit yourself to nominal rates; consider dividend tax, double taxation treaties, and tax holidays.
• Assess substance and compliance requirements: check if you can ensure real presence and transparent ownership structure.
• Calculate ROI and support costs: include expenses for registration, audits, compliance, and account maintenance.
• Check tax risks and long-term trends: study planned tax reforms in the chosen country.
• Prepare the registration document package: charter, beneficiary details, address confirmation, business plan.
• Consult COREDO experts: this will help avoid mistakes at the registration stage and build a sustainable corporate structure in the EU.

COREDO’s practice confirms: only a comprehensive approach to choosing a jurisdiction — considering all aspects, from tax rates to compliance and substance requirements — ensures not only a minimal tax burden but also long-term business sustainability and transparency.

Choosing a low-tax country in Europe in 2025 is not just about finding the lowest rate, but a strategic decision that affects competitiveness, investment attractiveness, and corporate resilience. The COREDO team is ready to be your reliable partner at every stage of this journey, offering solutions based on deep market knowledge, international standards, and real case studies.

In international trade, trade tariffs are not just duties on importing or exporting goods. They are a complex system of instruments, including:

• Ad valorem and specific duties (a percentage of value or a fixed rate per unit of goods),
• Seasonal tariffs,
• Tariff quotas,
• Antidumping measures,
• Tariff escalation (higher rates on higher value-added products).

In Asia, tariff policy is highly variable: some countries pursue liberalization, while others have strict import duties and non-tariff barriers.

The impact of trade barriers on business

Trade barriers today are not only tariffs but also non-tariff restrictions: Licensing, technical regulations, quotas, currency controls, as well as EU and US sanctions regimes.

Such measures are especially relevant for companies working with high-risk markets or in sectors subject to export controls (for example, technology, finance, energy).

Tariffs of the EU, Asia and Africa: comparison

In the EU, special attention is paid to legal support of business and compliance with compliance standards, which is critical for access to European payment systems and the stock market.

Tariffs for business: risks and impact

Their changes can create both financial costs and market uncertainty, which is especially important to consider in strategic planning.

Tariff implications for business

Tariff risks for business manifest in reduced margins, increased operating costs and the need to revise business models.

• Assessment of ROI when tariff rates change,
• Analysis of business sensitivity to tariff changes,
• Scenario modeling for strategic planning.

At COREDO we use a comprehensive analysis of tariff consequences for companies, including:

• Assessment of ROI when tariff rates change,
• Analysis of business sensitivity to tariff changes,
• Scenario modeling for strategic planning.

Currency risks and logistics with new tariffs

COREDO’s experience has shown that multichannel logistics and currency hedging can significantly reduce the impact of tariffs on logistics and ensure the resilience of supply chains.

For international companies, critical are:

• Managing currency flows,
• Optimization of foreign trade expenses,
• Using alternative supply routes when tariff policy changes.

Consequences of tariff wars for business

COREDO analytics shows that in 2025 the greatest vulnerability to new tariffs will remain with:

• The automotive industry,
• Electronics,
• The agricultural sector,
• Financial and payment services.

Scenario planning and stress-testing of trade models are becoming mandatory tools for companies focused on long-term development amid unstable trade policy.

Reducing risks in international trade

Rational management of these risks begins with optimizing tariff and foreign trade expenses, which not only increases business resilience but also reduces the likelihood of financial losses.

Practical methods for minimizing tariff costs include:

Optimization of tariff and foreign trade expenses

• Using tariff preferences under trade agreements,
• Trade diversification: entering new markets with lower tariffs,
• Optimizing supply chains and choosing alternative routes,
• Using re-export through jurisdictions with preferential regimes.

Understanding tariff and non-tariff barriers plays a key role in the efficiency of international trade, and it is equally important to consider compliance, AML and due diligence issues: we will examine their differences in detail in the next section.

Compliance, AML and due diligence: what’s the difference?

• Implementing compliance procedures when working with tariffs and sanctions,
• Conducting due diligence in international trade,
• Sanctions screening of counterparties and automation of compliance processes.

Managing tariff risks: automation and digitalization

Modern digital tools allow automating the monitoring of tariff and sanction changes, integrating ERP systems with customs and payment services, as well as performing trade analytics and forecasting tariff trends.

Company registration in the EU, Asia and Africa: tariffs and laws

company registration in the EU, Asia and Africa is not just a formal procedure but a strategic step that determines the conditions for doing business, its taxation and legal protection.

Registering a business in different countries

company registration in the EU, Asia and Africa requires a deep understanding of local regulatory nuances, including:

• Requirements for foreigners and ownership structure,
• Licensing of certain types of activities (banking, crypto, payment, forex services),
• Features of corporate structuring and beneficiary control (UBO).

How to choose a jurisdiction for business and taxes

The choice of jurisdiction for company registration should take into account:

• The size and structure of tariff barriers,
• Tax planning and transfer pricing,
• Availability of tariff preferences and trade agreements.

Legal support and compliance for business

That is why it is important to develop effective mechanisms in advance to reduce the impact of tariff changes on a company’s operations.

How to reduce the impact of tariffs on business

To ensure resilience under changing tariff policy, companies need to understand the main risks and know how to minimize them. Below we will consider specific smethods that will help reduce the impact of tariffs on business and manage tariff risks.

How to minimize tariff risks?

1. Conduct due diligence to assess tariff and sanction risks for all key counterparties and supply routes.
2. Implement automation for monitoring changes in tariffs and sanctions using digital tools and ERP system integration.
3. Use free economic zones and tariff preferences to optimize the structure of foreign trade operations.
4. Develop scenario planning and stress-testing of business models taking into account possible escalation of tariff wars.
5. Ensure legal support and compliance control at all stages: from company registration to making cross-border payments.

Metrics and KPIs for assessing effectiveness

To assess the effectiveness of measures to reduce tariff risks, we recommend using:

• Trade balance (export/import),
• ROI when tariff rates change,
• Share of tariff and logistics costs in the cost structure,
• Response time to changes in tariff policy,
• Compliance metrics: number of identified risks, speed of their elimination, level of process automation.

Legal and consulting partners

Best practices for interacting with legal advisors on tariff barriers include:

• Transparency of communications and regular updates on regulatory changes,
• Joint development of a corporate strategy for managing tariff and currency risks,
• Integration of corporate responsibility and ESG factors into the global trade strategy.

Recommendations for entrepreneurs

The impact of tariffs on trade and business requires a systemic approach: from strategic planning and optimization of foreign trade expenses to implementing compliance and AML for companies and continuous legal support for the business.

A global trade strategy should take into account corporate responsibility, ESG factors, and new requirements for transparency and sustainability.

In 2025, according to the Edelman Trust Barometer, the level of trust in companies became a key factor for partners, investors and regulators.

Business regulation in the EU, Asia and Africa: current trends

EU regulatory requirements for starting a business are becoming increasingly complex: transparency of ownership structure, disclosure of beneficial owners, mandatory implementation of compliance procedures according to FATF standards and regular audits of corporate reporting.

The COREDO team has implemented projects for company registration and obtaining financial licenses in the EU, the United Kingdom, Singapore and Dubai, where requirements for corporate compliance and anti-corruption practices are particularly high.

Registration of legal entities and compliance: how to meet the requirements

AML/KYC procedures when starting a business: how to avoid mistakes

In the EU and Singapore failure to meet these requirements leads not only to refusal of licensing but also to account freezes, fines and even criminal liability.

The solution developed at COREDO includes automation of compliance processes, integration of digital solutions for client identification and selection of trusted providers of AML services that meet FATF and ISO 37301 standards.

Business transparency and disclosure of beneficial owners: requirements and consequences

Beneficial ownership registers operating in the EU, the UK and a number of Asian countries require disclosure of ultimate owners and transparency of ownership structure.

In one project for a client from Estonia, the implementation of digital platforms for monitoring beneficiaries ensured ownership transparency and increased the company’s corporate rating.

Risks when registering a business: how to minimize them

Strategic risk management when registering a business abroad begins with partner checks and due diligence of potential counterparties.

One typical case: when registering a company in Dubai, a client faced risks related to insufficient transparency of a partner’s ownership structure.

Moving on to vopFor corporate governance and ensuring long-term sustainability, the key becomes building effective internal processes and a transparent decision-making structure in the company.

Corporate governance and business resilience

ESG factors and corporate responsibility: new standards of trust

The integration of ESG factors (Environmental, Social, Governance) is becoming a standard for companies seeking long-term investor trust and sustainable business development.

COREDO’s experience shows that implementing corporate ethics, reporting transparency, and building a sustainable brand image directly affect corporate ratings and the company’s value when entering foreign markets.

Corporate culture and internal audit: tools to prevent reputational losses

At COREDO we implement internal audit systems compliant with international standards (for example, ISO 37301), which allows not only detecting and addressing violations at an early stage, but also shaping a corporate culture of responsibility and transparency.

International law for business by region

How to choose a jurisdiction to register a company considering reputational and regulatory factors

choice of jurisdiction – a strategic stage that determines reputational and regulatory risks, as well as a business’s investment attractiveness.

For example, when entering the EU market it is important to consider not only regulatory requirements for disclosing beneficiaries and reporting transparency, but also the influence of public opinion, digital reputation, and corporate ratings on business scaling opportunities.

Cases and mistakes: consequences of non-compliance with regulatory requirements

Failure to comply with regulatory requirements leads to account freezes, fines, restricted access to financial services, and long-term reputational losses.

Further digitization of compliance is becoming a key element in increasing business resilience to reputational and regulatory challenges.

Digital transformation of compliance and reputation

Technologies for monitoring and managing reputation: tools and metrics

Modern digital platforms for reputation monitoring allow real-time tracking of company mentions, analyzing digital traces, managing reviews, and conducting reputation audits.

Key metrics for assessing ROI from reputation investments include trends in corporate ratings, the Edelman Trust Barometer index, the number of positive reviews, incident response speed, and partner engagement levels.

Automation of compliance processes: cost reduction and increased reliability

Automation of compliance processes is not only about reducing costs, but also about increasing the reliability of corporate governance.

Recommendations for entrepreneurs and managers

Checklist: how to prepare a company for a regulator inspection

1. Conduct an independent internal audit and a reputational audit.
2. Ensure transparency of ownership structure and disclosure of all beneficiaries.
3. Implement automated KYC/AML procedures and regularly update compliance policy.
4. Prepare documentspolicy on corporate governance, internal control and ESG reporting.
5. Conduct employee training on corporate ethics and conflict-of-interest management.
6. Integrate digital platforms for reputation monitoring and review management.

Strategies to minimize reputational and regulatory risks

• Regularly conduct partner checks and due diligence using OSINT and automated platforms.
• Form strategic alliances with verified AML service providers.
• Implement corporate compliance based on international standards ISO 37301 and ISO 37001.
• Develop crisis PR scenarios and a business reputation recovery plan.
• Integrate ESG factors into corporate governance to increase investor trust.

Metrics and ROI: how to evaluate the effectiveness of investments in reputation and compliance

• Trends in corporate rating and reputational index.
• Number of successful partner checks and absence of incidents.
• Level of business transparency and the speed of passing regulatory inspections.
• ROI from investments in digital solutions for compliance and reputation monitoring.
• Increase in investment attractiveness and access to new financial instruments.

Key findings and recommendations

In the modern world, opening a company abroad requires not only knowledge of the regulatory environment, but also strategic management of business reputation, corporate compliance, and business transparency.

I recommend using the presented tools and checklists as a basis for strategic planning, and if complex issues arise, consulting COREDO experts for an individual solution adapted to the specifics of your business and the chosen jurisdiction.