If you choose a jurisdiction in the European Union for registering a business, then a considerable list of arguments can be singled out in favor of Slovakia. The active growth of the economy is combined with an understandable and acceptable tax system for entrepreneurship. In accordance with the Commercial Code of Slovakia, legal entities can be established both by citizens of the country and by non-residents.
Opening a company in Slovakia is an exit to new horizons for business, as well as an opportunity to optimize taxation as part of building a holding structure or in other ways. Lawrange lawyers are ready to help with the necessary steps for registering a company in Slovakia. The cost of services for registering a company in Slovakia is 2,499 EUR (this price does not include apostille and translation of documents). The cost of opening an account is from 1,000 EUR (to be agreed separately).
Features of Slovakia as a business jurisdiction
Slovakia’s accession to the European Union in 2004 and the entry of the state into the Eurozone became an impetus for the development of various sectors of the economy and the financial sector. At the same time, this Central European country maintains a favorable investment climate. If a foreign investor wishes to establish a legal entity in Slovakia, then there will be no obstacles on the way to this for him.
Note! The procedures for registering an enterprise in the country can be carried out through representatives of JSC Lawrange without a personal visit. To do this, you will need a notarized power of attorney.
Depending on the type of activity chosen, additional steps may be required to fully start the work of the company. First, some types of business require a license. Along with this, there are about 170 “free” activities. They do not require additional permissions. Secondly, if you plan to carry out export-import operations, then you will need customs accreditation – registration with EORI.
Note! A large list of types of entrepreneurial activity includes a trade license. However, in the case of a craft or some other activity, proof of professional competence must be presented. It’s about both education and experience. Some activities require other licenses. An example is the provision of medical services, banking, transportation of goods, and gambling.
In most respects, setting up and doing business in Slovakia is comparable to doing business in other EU countries. In particular, we are talking about the need for each company registered in Slovakia to prepare and submit reports. At the same time, the reporting period in the country, as a general rule, coincides with the calendar year. The rules for the formation and filing of reports for legal entities in Slovakia are simple, so their observance usually does not require excessive efforts.
Benefits of opening a company in Slovakia
If you doubt the choice of Slovakia for opening your foreign company, then we suggest considering the main arguments in favor of this country:
- favorable geographical position for international trade;
- unlimited access to the market and counterparties in the European Union;
- the availability of a skilled workforce with a quality education;
- lower than in many other EU states, labor costs;
- business-friendly taxation, especially for small businesses (if a company’s annual turnover is less than 100,000 euros, then such a company pays income tax at a reduced rate of 15%);
- high level of infrastructure development;
- availability of agreements on avoidance of double taxation with dozens of countries of the world;
- an entrepreneur can relatively easily and in a short period of time obtain a residence permit (and this is a residence permit in the European Union);
- the country is suitable for the development of start-ups and high-risk activities (for example, for trading).
Types of companies in Slovakia
According to the Commercial Code of Slovakia, the requirements for the size of the authorized capital, the list of necessary documents and a number of other conditions for organizing an enterprise depend on its organizational and legal form (OPF).
Foreign companies in the Slovak Republic are allowed to register: a) branches; b) subsidiaries; and c) representative offices. The choice of the BPF depends on the strategies and business development needs.
Note! A representative office (organizačná zložka) has no legal personality. A legal entity does not arise as a result of the registration of a representative office.
If we single out business entities in Slovakia endowed with legal personality, then these are: firstly, an individual (private) entrepreneur – živnostník, samostatne zárobkovo činná osoba (SZČO), and secondly, various forms of companies.
Let’s look into the most common organizational and legal forms of business in Slovakia!
Limited Liability Company – S.R.O.
Entrepreneurs who want to start their own business in Slovakia, Lawrange experts advise to take a closer look at this organizational and legal form as a matter of priority. This is the best option for small and medium businesses. The vast majority (more than 95%) of economic companies in the country conduct their activities in this form.
- established by both individuals and legal entities;
- the size of the authorized capital is at least 5,000 euros, from each participant the contribution must be at least 750 euros (15% of 5,000 euros), to participate in a business with a share of less than 15%, the size of the authorized capital should be increased;
- before submitting an application for registration, it is necessary to deposit at least 30% of each contribution of the participant, but not less than 50% of the minimum authorized capital;
- a participant cannot be a person with a tax debt;
- the company is liable for obligations and debts with all its property;
- the liability of the participants is limited to the contribution to the authorized capital;
- the minimum number of participants is 1, the maximum number is 50 (for more participants, A.S. and J.A.S. are intended);
- the supreme management body of the enterprise is the general meeting of shareholders;
- through the meeting, an executive director is appointed – necessarily a resident of Slovakia or a citizen of one of the states of the European Union;
- in the structure of management bodies, it is also possible to provide for a supervisory board (to control the activities of the director and prepare reports before the general meeting).
***Note: Predominantly when establishing S.R.O. the authorized capital is paid in the minimum allowable amount. There is no point in increasing capital except in cases of reducing the share of the participant.
Joint Stock Company – A.S., akciová společnost
If S.R.O. suitable for small and medium-sized businesses, then a joint-stock company is the best option for large enterprises. By analogy with other jurisdictions, joint-stock companies in Slovakia are: a) public (verejné) and b) non-public (súkromné), which is fixed by the Commercial Code.
***Note: Regardless of the type of joint-stock company, only one designation is used in all regulations and official documents – A.S.
Public JSCs have the right to place part of their shares on the stock market in the Eurozone. Similarly, shares are transferred without restrictions – the authorized capital increases.
- at least one participant, if it is a legal entity, and at least two participants, if they are individuals, have the right to establish a joint-stock company;
- in order to open a company in Slovakia in the form of a joint stock company, the authorized capital must be at least 25,000 euros;
- all capital is divided into a certain number of shares, for which the nominal value is set (while the market price of shares often differs from the nominal value);
- shareholders’ liability is limited to the value of the shares they own (while shareholders are not entitled to demand the return of investments in the company);
- managed by A.S. the general meeting (valné zhromaždenie), the supervisory board (dozorná rada) and the board of directors (predstavenstvo);
- the supreme governing body is the general meeting;
- the composition of the supervisory board (control body) must include at least 3 people;
- there can be one director (the number of directors is determined in the articles of association).
Attention! Unlike S.R.O., which can only be registered by one person, the opening of A.S. requires the participation of at least 4 people. The disadvantages also include a higher registration price and more time spent on paperwork than in the case of an LLC. Moreover, difficulties will arise already in the process of work. For example, for almost any change in the legal status of a company, you will have to visit a notary, use a notarial protocol costing several hundred euros.
Joint stock company J.A.S., jednoduchá spoločnosť na akcie
This organizational and legal form of doing business appeared relatively recently – in 2017. This is an intermediate link between JSC and LLC. This form of business is most suitable for startups. We are talking about a structure where there is: a) the author of the idea; b) investor; c) a shareholder who joined later. J.A.S. makes it possible to optimally regulate the relationship between these parties.
- it is allowed to establish a company by one participant (unlike a classic joint-stock company, which requires the involvement of at least four shareholders);
- the size of the authorized capital – from 1 euro, the cost of one share – from 1 cent;
- participation of a person with a tax debt is allowed;
- different shares of the company are assigned different rights, as well as combinations of rights (for example, we are talking about shares with or without voting rights, with the right to receive dividends or with the right to double dividends, with or without the right to information about activities rights);
- the charter may establish a prohibition on the sale of shares or the loss of certain rights after the sale;
- it is possible to do without the formation of a supervisory board;
- the change of shareholders does not need to be recorded in the commercial register.
****Note: If you’re leaning towards J.A.S. to register your business in Slovakia, you must take into account two points. First, registering J.A.S. is more expensive than paperwork for S.R.O. Secondly, the procedure takes longer – about five weeks.
General partnership (general partnership) – V.O.S., verejná obchodná spoločnosť
Similar to partnerships in other jurisdictions. In a general partnership, partners are liable for the obligations and debts of the business equally with personal assets. Management decisions are made jointly, unless otherwise provided by the partnership agreement.
Limited partnership (limited partnership) – K.S., komanditná spoločnosť
In contrast to the general partnership in the structure of participants K.S. includes limited partners – persons whose liability for the obligations of the company is limited to a contribution to capital. Such business entities are formed by at least two members: the general and the silent partner.
Documents and information for setting up a company
You must be prepared for submission to the registration authority:
- copies of identity cards (passports) of the founders and directors – notarized;
- information about the permanent place of residence of these persons (it is most convenient to use utility bills to confirm the address of residence);
- if there is only one founder, an official statement that he does not own more than three other companies in Slovakia;
- if the founder is a legal entity – an extract from the commercial register not older than three months;
- certificates of non-conviction of the founders – not older than three months;
- to confirm the local presence (legal address) – a lease agreement and title document (certificates of ownership) for the premises;
- unique name of the company (preliminarily checked);
- a list of activities that are planned to be carried out, including those requiring licensing;
- optionally for some organizational and legal forms of business – a certificate from the tax authorities on the absence of tax debts from partners.
Representatives of JSC Lawrange are also involved in solving such issues as the development and notarization of the company’s charter and memorandum of association, depositing the authorized capital into a bank account and paying the registration fee.
***Note: Some documents from the list must first be translated into Slovak and certified by a state sworn (court) translator. The cost of a translation certified by a sworn translator is 25 euros per A4 page (the number of characters is not taken into account).
How to register your company in Slovakia: steps
Stage 1. Preparation of documents and information.
The name of the company is selected, agreed upon and reserved, the types of activity and organizational and legal form are determined, the issue of the legal address and the director is resolved, the charter is being prepared.
Stage 2. Certification of constituent documents by a notary.
There is no mandatory need for a founder to travel to Slovakia. Signatures are certified at the Slovak embassy or apostilled by a local notary. But if you want it, we can arrange a visit to Slovakia for you.
Stage 3. Opening a temporary bank account to deposit the authorized capital.
The required amount is deposited to the issued account, depending on the chosen organizational and legal form. Based on this, the bank issues an appropriate certificate.
Stage 4. Submission of documents for company registration.
A complete package of collected documentation is submitted for registration of a company in the state commercial register. The result of the procedure is obtaining an extract from the trade register. Applications are also submitted to the tax and customs (if necessary) service, to the social. service and to the licensing authority (Bureau of Trade Licensing).
Stage 5. Opening a current corporate bank account.
When registering the account, the director of the company must be present. Alternatively, an account for a Slovak company can be opened in some other EU state (but this practice is not very common).
Registration terms are about three weeks from the date of submission of the full package of documentation to the registration authority.
Taxation in Slovakia
Unlike a number of prestigious EU jurisdictions, the business taxation system in Slovakia is not characterized by complexity and intricacies. However, if you are planning to open a company in Slovakia, you need to understand the taxes.
In particular, legal entities in the country pay the following taxes:
- value added tax (VAT):
– standard rate – 20% for most goods and services;
– reduced rate – 10% for medical products and food;
– zero rate – 0%, that is, exemption from VAT, for some insurance and financial services;
- corporate tax:
– base rate – 21%;
– reduced rate – 15% for companies whose annual turnover is less than 100 thousand euros;
- tax on dividends – 35%;
- no capital gains tax.
Benefits of cooperation with Lawrange
For more than 10 years Lawrange has been specializing in the registration and legal support of international business. During this time, we have managed to build a network of partners in different countries of the world. We fully trust these partners, and we can confidently guarantee that they will fulfill all the requests of our customers.
In particular, our company closely cooperates with partners in Slovakia, which provides a quick and professional solution to the whole range of issues that arise at the start of a business, issues with a legal address, nominee director and opening an account in a local bank. Moreover, as necessary, with our support, you can arrange legal and accounting support for your company after registration. We are talking about the provision of accounting services and the submission of mandatory reporting, VAT declaration, payroll administration, submission of statistical information, and so on.
Opening a company in Slovakia is a task that can be solved in a short time and with minimal cash costs. The variability of organizational and legal forms of doing business under the law makes it possible to choose the optimal structure for any nuances and requests of the entrepreneur. Standard requirements for licensing, registration with the tax and customs services are quite feasible. As well as bookkeeping. Both registration and maintenance of a company are cheaper than in a number of other EU countries.
JSC Lawrange experts have the necessary experience to close the issue of registering a company as quickly as possible. Within two to three weeks after submitting the documents, you will be able to fully launch your business. And we, for our part, guarantee confidentiality and sincere assistance to your interests at all stages of our cooperation.
What documents are needed to register a company in Slovakia?
We will send you a specific list of documents for registering a company after the conclusion of a cooperation agreement. Approximately you will need your passport, receipts for utilities (to confirm the address of residence), and a certificate of good conduct.
Can a non-resident register a company in Slovakia?
Yes, a citizen of any country can be a participant in a legal entity in Slovakia (regardless of the organizational and legal form). However, only a resident of Slovakia or a citizen of one of the states of the European Union can be appointed as a director (manager) of a company in Slovakia.
How much does it cost to open a company in Slovakia?
The basic cost of services from JSC Lawrange starts from 2,499 EUR. At the same time, some services are not included in this base cost, and must be paid separately.