Company for a freelancer - long term plan

[Crowell]

How do you solve the company-tax issue after leaving your home country?

I don't have a "backup home" anymore and decided to incorporate due to a long-term freelancing contract I've got. I see the company I'll make as an asset holder, to which I'll be always putting in more than taking out. I'd love to invest the remaining money on the stock market. I'm a European citizen but willing to receive a new passport and tax residency in the near future. Yet, for now I want to start from step one - incorporation.

I'm looking for a country with low taxes (surprise) including low corporate tax, withdrawal tax, corporate tax and capital gain tax.

Could you please share your opinions about it? I read a ton of articles and the more I read the more I'm confused.

Should I aim into Cyprus, Isle of Man, Singapore? What about the banking, is it really such problem?
Should I make a sole-proprietorship in Spain because the contract is not 100k+/y so I shouldn't bother now and wait 2-3 years to have a proper residency and then try again with incorporating? But then why to wait?

What are your solutions? Please share your advice

 

[JohnLocke]

You could setup a simple Cyprus company for this purpose, it's less than 2K to setup and the same for the accounting and tax reporting each year. Doing so you will have something to work with long term. It's easy to change a Cyprus company to adapt your changing situation.

 

[Martin Everson]

If you are willing to take a long term view to earning money from a contract and being able to invest it tax efficiently then Cyprus is ideal.

The benefit of being in Cyprus as a non-domicile freelancer is that you will pay no taxes on investment income, bank interest, dividends, no capital gains tax (except Cyprus real estate), no inheritance taxes and no wealth taxes. Plus the weather is good . With a decent capital base following a good contract you can live of gains from your capital and effectively live tax free like the Russians and Ukrainians do in Cyprus .

If you however want a maximalist view over saving every last bit of tax from this contract there are other options. However it's totally fair to pay tax once knowing you won't pay it again on future investment earnings from the same money .

 

[GrumpyMess]

it's less than 2K to setup and the same for the accounting and tax reporting each year

Are you sure? I communicated with several companies and the minimum amount was around 3k.

However it's totally fair to pay tax once knowing you won't pay it again on future investment earnings from the same money

Yes, if there are no available options not to pay any tax legally, the 12.5% tax rate is not a bad choice at all.