For legal activities, you will need to receive a crypto license. A lot of states provide their demands for permitting. But to make the right choice, you must know the requirements thoroughly. Offshore companies often enjoy preferential taxation and other benefits.
What does a permit provide in European countries?
Countries such as Lithuania, Estonia, Poland, the Czech Republic, and Switzerland are attractive areas for crypto activities. The European permit for activities provides the opportunity to engage in activities legally in all EU areas. Such licensing inspires respect among business partners, and the transactions will be transparent and comply with the law.
This regulation aims to create a unified regulatory framework for permitting activities. MiCA approval is planned for the second half of 2024 – the first half of 2025.
The MiCA demands will impact any crypto organization planning to engage in digital assets in the European Union. However, this standard will not affect each state’s internal legislative framework. Local cryptocurrency legislation will be in addition to the MiCA, which must be complied with when permitted in a particular Europe. Therefore, when choosing a state for licensing, you should consider local requirements and the nature of regulation, including paying attention to the advantages of licensing in a particular country.
Here are the benefits of permitting in some European areas.
Since digital coin exchange services and the provision of crypto storage are not considered financial services, VAT is 0%. If the company has less than 10 people and annual income does not exceed 300 thousand euros, then the corporate tax will be only 0-5%.
The licensing period is short – no more than three months from the date of application. The permit has a high reputation, which ensures the trust of partners and customers. The banking system is very developed. The Regulator actively supports business.
This state does not impose conditions on the size of the authorized capital. There is also no need to declare income from activities. The Autonomous Region of Madeira has its requirements, and companies registering there as IBCM are entitled to preferential taxation. In addition, there is no tax on dividends in Madeira.
What does a crypto permit provide in non-European countries?
In addition to European countries, you can obtain a permit in jurisdictions such as Canada, UAE, Hong Kong, Kazakhstan, etc. Each state has its own licensing rules and advantages for offshore companies. Registering a business can also have significant differences, as well as the financial costs of registration. Many countries are loyal to digital coins and actively support companies at the legislative level. Many areas provide very favorable conditions, such as:
- low taxation;
- short period of business registration and licensing process;
- no demands for authorized capital.
It is essential to pay attention to the demands of the Regulator and soberly assess your capabilities. Here are the advantages of a permit in some states.
It is pretty easy to open a crypto business. The state does not have a tax on capital gains from crypto activities. A permit will allow you to reach potential investors, ensuring the company’s financial growth. Rights in Hong Kong are highly valued, facilitating active cooperation. The authorities are actively supporting the digital asset ecosystem.
United Arab Emirates
The DMCC permit allows firms to own 100% foreign capital, eliminating the need to attract local shareholders. It makes it possible to have complete control over your business. The licensing process takes only 7-10 business days, and you can start with a small amount – from 20,000 US dollars.
There is no demand for authorized capital, and licensing will take up to three months. The license cost is only US$2,000, and there is no annual licensing fee.
As you can see, many states offer different benefits for receiving a permit for activities. These include small financial costs, licensing terms, and taxation. Therefore, when choosing, determine the priorities for your company, and then the choice of offshore jurisdiction will be successful.