Costs, timelines, hidden fees

Who this is for / not for

This guide is for anyone planning incorporation and banking and wants a realistic view of cost buckets, timeline stages, what drives variance, and renewals. It is not for you if you only need rough headline numbers without context.

Decision summary

  • Cost buckets: formation, registered agent/office, banking (if any setup fee), accounting and compliance, and ongoing renewals.
  • Timeline: formation can be days to weeks; banking often takes longer (weeks to months) and is the main variable.
  • Variance comes from jurisdiction, service level, document readiness, and provider; plan for renewals from year one.

Banking & payments reality

Bank account opening is often free; some banks or introducers charge. Delays from incomplete KYC or underwriting extend timelines. See Bank account opening checklist. Payment processor setup may have fees; see Payment processors readiness.

Costs & timeline

Typical cost buckets: (1) Formation and state/registry fees; (2) Registered agent or registered office; (3) Bank account (setup fees if any); (4) Accounting, tax, and compliance (annual); (5) Renewals (annual returns, licences, registered agent). Ranges depend heavily on jurisdiction — see Compare jurisdictions and individual jurisdiction pages.

Timeline stages: Document prep → formation → post-formation (e.g. register, tax ID) → banking application → banking approval. Formation can be fast; banking often adds weeks or months. What drives variance: jurisdiction, provider workload, document completeness, and risk profile.

Renewals: Most structures have annual costs: returns, registered agent, sometimes licences or substance. Factor these into total cost of ownership from year one.

Docs & KYC checklist

Document readiness shortens timelines and can reduce back-and-forth cost. See Bank account opening checklist and Bankability checklist.

Ongoing obligations

Ongoing: annual returns and filings; registered agent/office; accounting and (where applicable) tax compliance; AML/beneficial-ownership updates. Jurisdiction pages describe local obligations. See also Compliance (CRS/FATCA/AML).

Common failure points / red flags

Common pitfalls: budgeting only for formation and forgetting banking timeline and renewals; hidden fees from bundled services or undisclosed introducer fees; choosing the cheapest formation without checking bankability. See Red flags & scams for due diligence.

Alternatives

Different jurisdictions and entity types have different cost and timeline profiles. Use Compare jurisdictions and use-case pages to shortlist; see International business structuring for the full map.

FAQ

What are typical formation costs?
Varies by jurisdiction: from hundreds to several thousand (currency depends on location). Include government/registry fees and registered agent or office. Compare total first-year cost, not only formation.
Why does banking take longer than incorporation?
Banks conduct KYC and risk assessment; they are not obliged to open accounts and may have queues. Incomplete applications add delay. Plan for banking as the critical path after formation.
What are hidden fees?
Fees not clearly stated upfront: e.g. introducer or referral fees, bundled compliance that you did not expect, or renewal increases. Ask for a full cost breakdown and annual renewal estimate before committing.
Do I need to budget for renewals in year one?
Yes. Most entities have annual returns, registered agent, and sometimes licences. Budget for at least the first renewal so you are not surprised.
What drives timeline variance?
Jurisdiction and provider workload; completeness of your documents and narrative; complexity (e.g. multiple UBOs, high-risk sector). Being document-ready shortens the process.

Next steps