Dear all,
as with so many here, I am new to the whole offshore idea, and have a couple of questions. Please help me understand.
I am giving you all the details that I think could help below. My questions will be at the end. Please feel free to ask me for further information/clarification.
The situation:
1. I am a German citizen, who currently lives and works in the UK.
2. I do not want to commit tax evasion. ( just to clarify, as some people ask this here
) I am looking for reasonable tax optimization. (with reasonable I mean: considerable savings, but it shouldn´t cost me alot upfront and not take months to set up)
3. I have a decent job in the UK and am paying full income taxes in the UK.
4. I am about to start a company in a field I am very experienced in and had previously a company and did quite well.
5. My new company will specialize in digital goods. I can work from anywhere, however, I am happy living in the UK (and likely would not move until 2013-2014).
6. My customers are from around the world. I will receive most payments from customers in the US (I estimate ~50%), the other will be Europe (~35%), and rest of Central and East Asia (~12%), rest will be Africa etc (~3%). This will not change much over the next 2-3 years.
7. I am planning to run this company side by side to my job. I will keep my main job and I will keep paying income taxes on my current job in the UK.
8. If I should move to another country, I plan to keep on working a regular job (and pay income taxes, wherever I live), unless I will make several millions with my new business, but let´s say I will realistically only make 100k-200k per year for the next 2-3 years to come. I am in this for the long run though, and do expect higher incomes in 5-10 years time, but until then, lets please assume I keep working my regular job and pay income taxes on it, and do not need to pay myself any salary through my new business.
9. I want tax optimization, but within reason. What I am trying to say: I do not intend to spend a huge amount on this first stage of the business, but want to get an easy start into offshoring (so no big jumps at the beginning). If I can save 5-10% on taxes, great, if I can save more, awesome - but it should not require me to fly around the world at this stage, just to open a bank account
10. As I said, I will not need to pay myself a salary through my new business, HOWEVER, I want to make sure that I do not run into any problems using my company´s revenue to keep on building my company (example: at the beginning I will use payment gateways to process credit card charges, so the country / company / bank solution I need has to be 100% accepted, 100% legal, and offer internet banking to pay for company bills/expenses etc)
11. I am planning to start paying myself a salary through the new business in maybe 1-2 years time, at that point I would be willing to move on to another country, e.g. for tax optimization, however, I will likely not abandon my home country, the UK, or the US (places I like to live) just to avoid income taxes. I believe in paying income taxes on your salary, but want to do it smartly, and to some extend optimized (i.e. just as Mitt Romney lives in the US and pays only 13.9% tax .. don´t know exactly how, has something to do with capital gains tax, but would love to understand this in full, but as I do not plan to pay myself any salary for the next 1-2 years, this should be kept in context).
My questions:
1) Given the above scenario, what´s a good place for me to incorporate?
2) Where should I open a bank account for my business? (Please note: As I am new to offshoring, I do not intend to send $15000 to some country at this point in time see point 9 and 10)
3) What are the costs involved?
4) How long does it take?
Thanks in advance. Looking forward to read your comments.
Best
Specter
as with so many here, I am new to the whole offshore idea, and have a couple of questions. Please help me understand.
I am giving you all the details that I think could help below. My questions will be at the end. Please feel free to ask me for further information/clarification.
The situation:
1. I am a German citizen, who currently lives and works in the UK.
2. I do not want to commit tax evasion. ( just to clarify, as some people ask this here
) I am looking for reasonable tax optimization. (with reasonable I mean: considerable savings, but it shouldn´t cost me alot upfront and not take months to set up)3. I have a decent job in the UK and am paying full income taxes in the UK.
4. I am about to start a company in a field I am very experienced in and had previously a company and did quite well.
5. My new company will specialize in digital goods. I can work from anywhere, however, I am happy living in the UK (and likely would not move until 2013-2014).
6. My customers are from around the world. I will receive most payments from customers in the US (I estimate ~50%), the other will be Europe (~35%), and rest of Central and East Asia (~12%), rest will be Africa etc (~3%). This will not change much over the next 2-3 years.
7. I am planning to run this company side by side to my job. I will keep my main job and I will keep paying income taxes on my current job in the UK.
8. If I should move to another country, I plan to keep on working a regular job (and pay income taxes, wherever I live), unless I will make several millions with my new business, but let´s say I will realistically only make 100k-200k per year for the next 2-3 years to come. I am in this for the long run though, and do expect higher incomes in 5-10 years time, but until then, lets please assume I keep working my regular job and pay income taxes on it, and do not need to pay myself any salary through my new business.
9. I want tax optimization, but within reason. What I am trying to say: I do not intend to spend a huge amount on this first stage of the business, but want to get an easy start into offshoring (so no big jumps at the beginning). If I can save 5-10% on taxes, great, if I can save more, awesome - but it should not require me to fly around the world at this stage, just to open a bank account
10. As I said, I will not need to pay myself a salary through my new business, HOWEVER, I want to make sure that I do not run into any problems using my company´s revenue to keep on building my company (example: at the beginning I will use payment gateways to process credit card charges, so the country / company / bank solution I need has to be 100% accepted, 100% legal, and offer internet banking to pay for company bills/expenses etc)
11. I am planning to start paying myself a salary through the new business in maybe 1-2 years time, at that point I would be willing to move on to another country, e.g. for tax optimization, however, I will likely not abandon my home country, the UK, or the US (places I like to live) just to avoid income taxes. I believe in paying income taxes on your salary, but want to do it smartly, and to some extend optimized (i.e. just as Mitt Romney lives in the US and pays only 13.9% tax .. don´t know exactly how, has something to do with capital gains tax, but would love to understand this in full, but as I do not plan to pay myself any salary for the next 1-2 years, this should be kept in context).
My questions:
1) Given the above scenario, what´s a good place for me to incorporate?
2) Where should I open a bank account for my business? (Please note: As I am new to offshoring, I do not intend to send $15000 to some country at this point in time
see point 9 and 10)3) What are the costs involved?
4) How long does it take?
Thanks in advance. Looking forward to read your comments.
Best
Specter
Offshore companies can have a bank account anywhere in the world, so again, you've got plenty of options. However, consider that many banks require that if you are using merchant accounts for payments processing that you need to incorporate in the same country as the bank's domicile. Costs range depending upon your needs and wishes, the service provider and the country of incorporation.
