If you’re thinking about relocating abroad, buying a business can be one of the best methods to hit the ground running.
Investing in an existing business can provide stability amidst a change of scenery, a move into a new home, and all the other admin that comes with emigrating. Having a base of proven customers and systems that you can adapt takes away much of the stress of starting from scratch.
But UK residents might be wondering about the logistics of buying a business abroad. What key information do you need to know to make it work, and what common risks and challenges should you try to avoid? In this article, BusinessesForSale.com speaks to some business owners who’ve made it happen, and provide advice and guidance for others thinking of doing the same.
Using BusinessesForSale.com to move to Europe
Theresa Hicks and her husband moved from the UK to Camposol, Spain, in 2003. They set up a successful business there running qualified heating engineering services, with many of their customers being English-speaking expats. “My husband Kevin installed central heating in our villa, which was freezing,” says Theresa. “Once our neighbours saw what we had done, we couldn’t get rid of them in the evening because ours was so cosy! It quickly became apparent there was a real need for a qualified, English-speaking engineer in the area.”
Camposol Heating and Maintenance was born in April 2005, set up as an SL Company with 100 shares. Almost twenty years later, Theresa and Kevin decided to sell their business, as the couple were approaching retirement. Using BusinessesForSale.com, they found a qualified buyer in Edinburgh who had previous experience in the industry. Unfortunately, their buyer missed the Brexit deadline by just a few weeks, and as a result had to go down the new route for Britons who want to live and work in Spain – obtaining a visa.
Explaining the process of selling a Spanish business to a British buyer, Theresa says: “He firstly had to buy 50% of the shares, and then submit a five year business plan (based on our figures and history) to the consulate in Edinburgh. They took his P45 as part of his application which should have been 3 months, but it took just over 2 years to complete due to slow bureaucracy and some incompetence.”
The biggest piece of advice Theresa would give anyone thinking of making the same transition? Hire an immigration lawyer.
The biggest piece of advice Theresa would give anyone thinking of making the same transition? Hire an immigration lawyer. “The anti-Brexit crowd will tell you its impossible to work in Spain, which is not true - although there are more obstacles than there used to be,” she says. “My personal view is that if our buyer had used an immigration lawyer, we could have skipped a lot of the bureaucracy and completed the sale much quicker.”
Where in Europe should you move to?
If you’re thinking about migrating and buying a business, there are two questions you should ask yourself before deciding on your location. First – what skills do you have that might be in high demand elsewhere in Europe? And second – what countries are offering incentives for investors?
Portugal, for example, runs a Golden Visa programme which allows non-EU members to obtain residency permits if they make an investment in the country worth €500,000 (£413,000). It also applies if you own a company that creates a minimum of ten jobs for Portuguese citizens. Similar ‘residence by investment’ schemes can be found in countries like Spain, Greece, Italy, Hungary, and Latvia. In Latvia, the minimum investment fee needed to qualify is just €50,000.
Startup Visas, which provide residency for non-EU members helping to launch startup businesses, can also be found in Estonia, Lithuania, the Netherlands, Denmark and Finland. Investing in a promising startup could be an alternate route to buying a business outright.
European countries with lower rates of corporation tax may also be a consideration – if that’s the case, countries such as Andorra, Ireland, Hungary, Bulgaria might be worth investigating. If the business you’re thinking of buying is a small one, Georgia offers a special tax regime where ‘micro businesses’ with no employees and low income are not taxed.