UK Starting Business

I would like you to advise me, so as to be able and make the best choice in the formation of a company.

We are 2 students in a university of Greece and would like to form a company in order to offer some kind of sports statistics service worldwide. The company will work like this: Clients, who could be based anywhere in the world, would ask for our services and we will provide them. People who are based in numerous countries will carry out the work and we will be taking money for our services from our clients and then we will pay the workers.

We would like to see what our options are in order to form a company outside Greece, because we are students and we have as our priority, having the minimum cost for now and for future.

The system in Greece is complicated. What I mean by this is that in order to form a company, you have to pay around 5.000 euro per year in self-insurance (social insurance). This is obligatory. So company formation costs start from a minimum of 5.500-6.000 euro, without even including 20% VAT at half of the profits and of course there are the costs of lawyers and other people that might be paid. So as you can see forming a company in Greece is our last option, because this costs around 8.000 euro in total, (without even including the VAT fees) and will be the same for each year we run the company. This makes formation of a company in Greece the worst of our choices.

We have read some things about formation of a company in several countries, such as UK, Cyprus, even an offshore company in Seychelles and we would like you to advise us about which are our best options.

Parameters follow:

1. We estimate that for the 1st year we will have 15.000-30.000 euro profit. I mean that clients will give us around 30.000-60.000 euro and half of the money should be paid to the guys that do the job worldwide. For following year’s profits are undetermined at the present time and could vary considerably.
2. Another factor is that payments towards the workers that do the job are easier to be made via money bookers or PayPal, because we would like them to see only company’s name and not country of origin (Greece) or our names. I guess this could be possible to be done via other ways, such as bank payments, but we are not familiar with them and we would sure like some help if possible.

3. I have seen that there are several choices of forming a company and have read some things about them, but consider me like I have no relation with all these, so as I can understand everything you say in simple terms.

4. We would like to form a company and the cost is less than if we do that in Greece. As you can see we are European citizens (I don’t know if that plays a role).

So some questions general and more specific follow:

1. In any of the 3 categories (there might be other categories that might be more value to us, but we would like your suggestions on that) forming a company in UK, Cyprus or an Offshore in Seychelles, is there an obligatory social insurance per year?
2. Either we pay tax in the country of company (UK, Cyprus) or not (offshore in Seychelles) do we have to pay also any taxes in Greece?

Questions about forming a company in UK:
1. What is the total cost for the 1st year of forming a company in UK, including everything that is needed? I mean not only the first expenses, but all expenses that might occur during the year, such as annual report for the vat etc. (Have in mind that our company’s function will be simple enough. We just have clients that pay us for the same exact job every time and we send money to our guys that do it, so there is nothing really changing throughout all years, just the number of clients, the amount of services and the number of guys that have our job done and will be paid).
2. Which is the best type of a company? I have seen there is Ltd, LLP, some partnerships included, even an own company. Could you tell me about the benefits of each one?
3. Is there an amount which is tax free? I mean it might be a law in UK or Cyprus that says that for pure profits till 30.000 euro there is no VAT paid. Because if something like that happens it might be good for us. I know for sure that in Seychelles offshore companies are tax free.
4. What are the obligations (which mean that we can’t deny them and have to pay for them) in forming a company in 1) UK 2) Cyprus?
5. Is a physical presence of a director which costs around 2000GBP/year OBLIGATORY? Because I have seen in some site that and I would like to know about it.

Forming an offshore in Seychelles:
1. What is the cost for all? Is the total cost of around X euro that I have seen including everything? Your fee too?
2. So in other words if we have this X amount of money we don’t need any other expenses to be paid so as to form the company and throughout the 1st year?
3. What is the cost for the 2nd year? Same? Less?

I would be grateful if you could help me with my questions so as to see what is best for us and probably choose you in order to form the company.
In case there are any other suggestions, we would be also being delightful to know them.