What You Should Know About Starting a Business in Nicaragua
Some expats looking to make a life for themselves in a country like Nicaragua turn to the restaurant business, especially in touristy areas.
It’s possible for an American to open a modest restaurant in a town like San Juan del Sur, for instance. Although we think it’s a shame not to indulge in the local cuisine, a lot of tourists go to San Juan del Sur, and many of them are happy to pay for a restaurant experience similar to what they’d have back home.
Picture yourself serving beer and tacos out of a modest seaside restaurant. It’s not a bad way to earn a living. And because you’re targeting tourists, they’ll pay far more too.
It’s altogether possible to buy an existing restaurant and get your restaurant business going for well under US$20,000. So it doesn’t take long to earn your investment back and begin enjoying the profits.
Maybe you have no interest in the restaurant business and you’d rather start something from scratch. The upside to lack of jobs in Nicaragua is that you can hire talent very inexpensively.
Of course we’d recommend paying a decent living wage and not taking advantage of the situation, but the average Nicaraguan would be happy making US$150-200 a month.
So what kind of business should you start in Nicaragua? The sky is the limit, really. Just about any business you can conceive of back home you could start in Nicaragua.
Of course there are some realities you should be aware of. If your Spanish is limited, it will be very difficult to go through the bureaucracy of setting up the business legally. You can always hire a lawyer and an accountant to help though. If you want to take that route you might ask other expats who’ve set up business in the same area for a referral.
There is another, perhaps better option available to you.
Nicaragua does not tax on income earned outside the country. And the US does not tax on the first $101,300 earned if you’re no longer an American resident. So it’s entirely possible to start an internet based business while living in Nicaragua and owe zero income taxes, legally.
With the cost of living in Nicaragua so cheap, an income-tax free income goes a long way.
So while it is theoretically possible for you to work in Nicaragua, for most people, your better bet is to start a business – either locally or online.