A friend of mine is planning to start his own company. This blog post is a checklist for him. There are many similar lists available e.g. by state employment and economy ministry (here) or independent entrepreneurial associations (here), but they may be lacking some crucial little experience based details. This list concentrates on those details. And why not share the list here if it helps anyone else. Please correct me if you think I’m wrong; this is based on what I did with Tribe Studios and found to be good.
1. Have a founding meeting. Either fill the necessary papers yourself or together with possible co-founders. Remember these:
A. Make your company have sufficient amount of stock. Theoretically if you’re alone it could be just 1 stock but that will be difficult later on. I recommend at least 100 000 stock.
B. Do not state any “nominal stock value”. You do not ever have to register this number, it’s voluntary, and I don’t know any situation when it would be helpful.
C. I recommend you decide that calling together a company meeting can be done in one week. The default is two weeks, but one week works fine and often saves you time.
D. Make a shareholder agreement. This is not mandated by law, but if you’re more than one person it’s highly recommended to do this right from the start. You can get a good example from seriesseed.fi
2. Go to a bank and open a bank account for your company. You need to have a written board decision for opening the account, but if you’re alone, you can even have that board meeting in the bank so no biggie. Deposit a minimum of 2500 euros to the bank account. If you try to fill this minimum sum with other than cash, you’ll need official paper to state the value of your computer or such equipment, and that paper is going to cost you.
3. Now file the papers to PRH with the official bank account and bank statement of having the necessary starting money there. If you live in the capital area it’s easiest to just walk in their office, pay at the counter and hand over the papers (this way they won’t lose your mailed receipt…) PRH costs you 350 euros to register for Limited Liability Company (Oy). Any changes to the papers will cost you again, but very likely you’ll be making them at least once very soon unless you already had your accountants and auditor selected. I would recommend though that you go right away to all the registers, the main one + employer registry + tax (ALV) registry, unless your company will stay in the drawer at start.
4. Wait for a couple of weeks or one month if it happens to be July.
Congratulations, you have a company!
1. Get yourself an accountant. I highly recommend you take a good one. There has been time saving advice for startups that includes doing your own accounting in a “receipts stacked in a shoe box” type of manner, but that will not work in Finland. We have very active and watchful tax bear in Finland who will watch and react over if you fail to send in your necessary reports at the correct timing. Unless you really want to spend your days learning all that, get an accountant.
2. Get yourself an auditor. This is mandatory by law. If you don’t know any your accountant can probably recommend you someone. I recommend accredited (KTH, HTH) auditors. You may run in to situations where certain accreditations are needed for statements. (e.g. if you apply for government technology funding)
3. Get your company insured. Some minimum insurance is mandatory by law. The most expensive one is the pension insurance (YEL / TYEL) and there are organizations that specialize just on those. But you may get your other insurances cheaper if you take everything from the same place.
4. You need to have minimum health service coverage for you and your employees. This is also by law. The minimum packages from different health organizations offering these services aren’t very expensive so it’s up to you how much coverage you want. This area could be partly covered by optional insurances also.
Congratulations, you’re all setup! However few more tips on the running of the company are in order.
1. You need to follow your employees working hours. Have an excel file for this, that’s good enough. Two reasons: First, the governmental health regulations require that you do not overwork your employees so in the unlikely event you get a health inspection you need to have a paper that tracks how much everyone is working. Second, you may need to do this if you have governmental technology funding which requires you to track this. Luckily we have that funding so I feel like there’s at least some little sense in doing this.
2. If any of you travel, you can pay the person travelling the daily travel expense cost as allowed by the tax authorities. The Tax Authority will tell you the maximum sum per day per country of travel. This is the only non-taxable income you can have from your company. For this reason it is required to track it closely. You need to have every trip documented in the detail of who travelled, where, which flight and what _time_ of flight. These are the first documents you’ll be asked for if you ever win a tax inspection for your company. Best hold on to those stubs!
3. Follow your cash flow! It is quite silly but the only documents you’re sure to get from your accountant every month are the balance sheet (tase) and income statement (tulos). Neither of these tells you how much money you have and how fast you’re burning it. You can work with your accountant to get a cash flow statement but that’s also a good exercise to follow yourself. At least in the beginning when your accounts are still relatively simple.
