Best country for lowest tax - Online SaaS Business

[konfuci]

Hey,

I have SaaS business, serving mostly US, CA and Europe clients.
I am looking for a country to incorporate, where I will have lowest taxes to pay.

Which country has lowest taxes for online businesses?

 

[konfuci]

Operations will be done fully in Georgia.
I am also from Georgia.

 

[avalanche]

Hey,

I have SaaS business, serving mostly US, CA and Europe clients.
I am looking for a country to incorporate, where I will have lowest taxes to pay.

Which country has lowest taxes for online businesses?

You literally live in a country with no taxes for IT companies and you are looking for other countries?

 

[konfuci]

You literally live in a country with no taxes for IT companies and you are looking for other countries?

Thats not that easy. My venture does not fall in that category, so I have to pay taxes...
+ I can't get normal payment solution and whatever I use has around 8-10% fee.

 

[avalanche]

Thats not that easy. My venture does not fall in that category, so I have to pay taxes...
+ I can't get normal payment solution and whatever I use has around 8-10% fee.

what about TBC internet acquiring service?

 

[konfuci]

what about TBC internet acquiring service?

They don't allow foreign cards.

 

[jakubko666]

Georgia, USA or Georgia in asia. Gruzia? If you have low personal income tax in your country, use US LLC.

 

[avalanche]

They don't allow foreign cards.

How is that possible? In our case all Armenian banks offer merchant accounts that can process foreign cards even in EUR or USD currency.

 

[konfuci]

Georgia, USA or Georgia in asia. Gruzia? If you have low personal income tax in your country, use US LLC.

Georgia in Europe!
My clients are mostly from US, I prefer European LLC for tax reasons + I do not have low personal income tax.

How is that possible? In our case all Armenian banks offer merchant accounts that can process foreign cards even in EUR or USD currency.

Idk, that like it, also from technical wise, its not that advanced.


Anyway, do you know difference between Malta and Cyprus entities?

 

[avalanche]

Georgia in Europe!
My clients are mostly from US, I prefer European LLC for tax reasons + I do not have low personal income tax.



Idk, that like it, also from technical wise, its not that advanced.


Anyway, do you know difference between Malta and Cyprus entities?

Georgia is Asia mate.

 

[konfuci]

Georgia is Asia mate.

Georgia is on a crossroad between Asia and Europe, to be precise from a location perspective yes its more Asia than Europe, from cultural side we are more European, so I would call it Europe.
But its not related to the thread.

If you have experience with Cyprus or Malta entities would like to know more about their benefits for digital businesses, from a tax perspective.

 

[Zaki]

My clients are mostly from US, I prefer European LLC for tax reasons + I do not have low personal income tax.

Why Do you prefer Eu LLC? and why not US LLC?
Did you consider Estonian E-residency?
I need answers to give you specific and helpful advice

 

[konfuci]

Why Do you prefer Eu LLC? and why not US LLC?
Did you consider Estonian E-residency?
I need answers to give you specific and helpful advice

US is also fine for me.
I have Estonian e-residency, Estonia and Georgia has same tax regime, so I will have to pay 20% dividend tax anyway, which I think can be decreased by Malta entity or any other...

I have 2 main goals:

1. Get normal payment system (I guess from any country Malta/Cyprus/Estonia/US ... I will get it)
2. Minimize tax costs (All operations will be done in Georgia, I need entity in other country to get payment, take dividend and pay Georgian entity for service)

Thank you!

 

[Cetme308win]

UAE or Panama

 

[karishi]

If your business is legit UAE probably is the best option. you can also get residency in the UAE when creating a company. There are no taxes in UAE but for 5% VAT.

 

[Zaki]

US is also fine for me.
I have Estonian e-residency, Estonia and Georgia has same tax regime, so I will have to pay 20% dividend tax anyway, which I think can be decreased by Malta entity or any other...

I have 2 main goals:

1. Get normal payment system (I guess from any country Malta/Cyprus/Estonia/US ... I will get it)
2. Minimize tax costs (All operations will be done in Georgia, I need entity in other country to get payment, take dividend and pay Georgian entity for service)

Thank you!

You are lucky you live in Georgia
I think
1- US LLC will work great in your case
2- you won't pay any taxes not in the US nor in your country(Georgia)
Why?
US Perspective: US LLC is a pass-through entity and you won't pay any taxes as NRA
but you still have to file 5472 & 1120 forms every year
Georgia Perspective: the Tax System in Georgia is territorial, Which means
that Georgia will tax its residents on Georgian-sourced income only.
Good luck mate.

 

[JohnLocke]

@Hazqiyal are you sure that he has to pay no taxes in this case? sounds a little to easy for me, maybe it's just me

 

[Zaki]

are you sure that he has to pay no taxes in this case

that's what a territorial tax system stands for, isn't it ?
Georgia is the only country in Europe that does not tax worldwide income. A few Latin American countries operate on a territorial system , such as Panama and Nicaragua, as well as some Asian countries such as Malaysia and Hong Kong.
P.S @konfuci needs to consult with a Locale CPA to set up the right Scheme

 

[jatrex]

You are lucky you live in Georgia
I think
1- US LLC will work great in your case
2- you won't pay any taxes not in the US nor in your country(Georgia)
Why?
US Perspective: US LLC is a pass-through entity and you won't pay any taxes as NRA
but you still have to file 5472 & 1120 forms every year
Georgia Perspective: the Tax System in Georgia is territorial, Which means
that Georgia will tax its residents on Georgian-sourced income only.
Good luck mate.

I am currently doing business in Georgia and I know for a fact that what you are saying is not true. First of all the permanent establishment rules are very strict and the US LLC would quickly become tax resident here if the company was managed from Georgia: Tax Liability For Foreign Business Owners Living In Georgia |

Secondly, regarding Territorial taxation, this is something that is commonly misunderstood. It's rare in territorial tax countries that income from work being performed within the country would be considered foreign-sourced. The same holds true for Georgia. Mostly this only works for passive income.

Hey,

I have SaaS business, serving mostly US, CA and Europe clients.
I am looking for a country to incorporate, where I will have lowest taxes to pay.

Which country has lowest taxes for online businesses?

Georgia would still be an attractive choice if you did it right. I would recommend either the Virtual Zone LLC or Individual entrepreneur with small business status.

- With the Virtual zone LLC you have the benefits of having an LLC and you only pay 5% on dividends. This is the one I'm using, however, since April the government has cracked down hard on businesses with no local presence and revoking licenses leading to huge fines for companies who clearly follow the Georgian tax code. It is advised that you maintain office, employees, etc. for this structure to work now.
- With the Individual entrepreneur you have a sole proprietorship where you pay 1% tax on your revenue.

 

[SonjaL]

I am currently doing business in Georgia and I know for a fact that what you are saying is not true. First of all the permanent establishment rules are very strict and the US LLC would quickly become tax resident here if the company was managed from Georgia: Tax Liability For Foreign Business Owners Living In Georgia |

Secondly, regarding Territorial taxation, this is something that is commonly misunderstood. It's rare in territorial tax countries that income from work being performed within the country would be considered foreign-sourced. The same holds true for Georgia. Mostly this only works for passive income.


Georgia would still be an attractive choice if you did it right. I would recommend either the Virtual Zone LLC or Individual entrepreneur with small business status.

- With the Virtual zone LLC you have the benefits of having an LLC and you only pay 5% on dividends. This is the one I'm using, however, since April the government has cracked down hard on businesses with no local presence and revoking licenses leading to huge fines for companies who clearly follow the Georgian tax code. It is advised that you maintain office, employees, etc. for this structure to work now.
- With the Individual entrepreneur you have a sole proprietorship where you pay 1% tax on your revenue.

As Individual entrepreneur you have 1% over max 500.000 GEL, it is 3% over the rest and if it lasts over 2 years you will be moved to the normal, expensive regime