Can an Offshore Company help reduce taxes in Thailand?

[redchili]

I am an American starting a Thai company. We will be in the restaurant/hospitality sector selling to local Thais and tourists. We will be using a variety of in-house technologies to make our business unique (VR, interactive menus, robots, etc etc etc)... Is it possible to reduce the tax burden by having an Offshore Company own the technology licenses of which the Thai company pays a hefty monthly rental fee (ie a majority % of the profits)?

If required, we could even host a cloud licensing server in the offshore country which will send a ping back to our different technologies to verify their license is active or inactive. We also hire outsourced developers which could be paid from this offshore country as well to show R&D spending if required.

We will be living in Thailand permanently, and don't want to have any staff in the offshore country, nor relocate to that country.

However, we still want to reuse those Offshore profits back to the Thailand company to grow & expand the business. Not sure whats the best way to do this..

Last of all, is paying myself (American) in dividends from the Offshore Company (or Thai company) to minimize USA Taxes doable?

Is any of this legally feasible? If so, which countries would be ideal for this scenario? Thanks a lot. I tried to read 100s of posts already and find myself both inspired and confused. And yes, will talk with a lawyer before we go ahead.

cheers

 

[Spinat]

It would be considered a local business and for that reason you won't safe any taxes! You may consult a tax advisor, that would be my best suggestion to you in your situation.

 

[James Turner]

As @Spinat says, if you intend to do business in Thailand then the company will pay local taxes even if it is incorporated offshore. If you were a Thai resident and operated a company only doing business outside Thailand then the company would be subject to taxes in the country of formation, but as a restaurant in Thailand, that will not work.

 

[CyprusLawyer101]

You could use an offshore company as a financing vehicle as I understand that you are currently still abroad . Also if you will buy any goods from abroad then again you could allocate some income there. Tech support can also be allocated abroad , but dont expect much in licensing fees.

 

[wellington]

I am an American starting a Thai company. We will be in the restaurant/hospitality sector selling to local Thais and tourists. We will be using a variety of in-house technologies to make our business unique (VR, interactive menus, robots, etc etc etc)... Is it possible to reduce the tax burden by having an Offshore Company own the technology licenses of which the Thai company pays a hefty monthly rental fee (ie a majority % of the profits)?

If required, we could even host a cloud licensing server in the offshore country which will send a ping back to our different technologies to verify their license is active or inactive. We also hire outsourced developers which could be paid from this offshore country as well to show R&D spending if required.

We will be living in Thailand permanently, and don't want to have any staff in the offshore country, nor relocate to that country.

However, we still want to reuse those Offshore profits back to the Thailand company to grow & expand the business. Not sure whats the best way to do this..

Last of all, is paying myself (American) in dividends from the Offshore Company (or Thai company) to minimize USA Taxes doable?

Is any of this legally feasible? If so, which countries would be ideal for this scenario? Thanks a lot. I tried to read 100s of posts already and find myself both inspired and confused. And yes, will talk with a lawyer before we go ahead.

cheers

In Thailand, that would be investigated heavily as some form of AMOL violation and/or Tax Evasion.

You should be very careful... it's not a place to have those sorts of charges levied.

Best to just have a fair % fee monthly which say is 10% and pay the rest locally and the respectable tax monthly.

 

[Meta]

Hi,

I can't advise regarding the "personal USA tax on dividends" part, but I have acquaintances having restaurants here in Thailand. Tax administration control is basically non-existent. For smaller establishments (say, up to ten grands a month profits) you would just go to the bank as a director and withdraw cash as "expenses". Period. No reporting, taxes, anything, nobody cares.
So I'm not sure if your setup is 100% following the law (very possible it is, but consult a lawyer), but my bet is that it's viable.

Regards.