Freelance Business - Need advise on Tax optimisation

[NataliaDeynega]

Hi everyone.

The situation is as follows. My husband is freelancer. We reside in Malta and when he started getting some success with his consultancy business we opened a company in Malta (planning to make a use of 5% rule). As a pair I was planning to open a Belize company which will be a UBO of Maltese one claiming the dividends and getting the refund. This was before I got to know that refund takes veeeeery long so not good for cash flow. So now I am looking for a solution how to get the money from Clients faster and cheaper (currently we are still paying 35% plus maintenance of the company, which I believe can be minimised in a legal way).

We cannot use Belize directly because of the Clients, but I was thinking if there is a possibility of a structure with an Offshore company in jurisdiction that does not cause trouble taking off the money directly and a "cushion" of a bank account in some legitimate jurisdiction (EU is preferable). Maybe someone knows of an online bank, which is eager to open an account to a newly formed offshore company somewhere in a legit county?

Alternative is maybe to open a Revolut corporate account for offshore (Belize) company. In this respect does anyone know if the Revolut IBAN 1) will refer to Revolut (sorry if it is a dummy question, what I mean is whether you see from looking at IBAN that the account is open with Revolut) and 2) will refer to Belize in any manner?

Otherwise I would so so appreciate for your assistance with figuring this out. Any suggestions are very appreciated. The main goal is to possibly move the operation of business somewhere away from Malta and away from 35% tax rate, or to find the solution how to lend the money in low tax jurisdiction without paying tax in Malta LEGALLY

Thank you in advance.

P.S Please feel free to ask whatever clarifications needed as I do understand that above may be not very clear.

On separate note, does anyone from experience know how much the operation of Belize IBC may cost per year?

 

[NataliaDeynega]

Hi @TodMca, thank you for sharing your thoughts.

I though everything will be much easier

Hi there, if you both reside in MT as tax residents (not tourists) your MT company is not entitled to tax refund of 6/7. This MT tax refund is only applicable for non-resident ubos. Statement of ubo non-MT-residency is submitted with the refund application.

Yes this we are aware of.

Putting BZ as the holding co. does not help either as long as you both are ubos of the BZ co. (btw MT is implementing ubo registry).

What if we move out of Malta? will BZ scheme work then? Plus I am not Maltese citizen, so (theoretically) can be the only UBO if needed.

I would consider forming some sort of UAE FZ entity.

What is UAE FZ?

 

[CaptK]

You have 2 options
UK LLP pass through company which you can open an EMI with IBAN. Tax paid in the jurisdiction of the members.

UAE Freezone company which comes with a tax residency and bank account. No tax whatsoever but now you must structure your payments to be as tax efficient as possible.

What you need with the UAE structure to make it truly tax efficient in Malta is substance. UAE office must have a manager and operations person, website, email address, telephone number.
Correspondence should be between staff and customers but you can sign off on stuff.

You could even use a combination of both also to achieve what you want. Belize is not a good option for you.

 

[NataliaDeynega]

The problem with setting up UAE company is exactly what I try to avoid: it is costly, has a starting capital + unnecessary people being paid just to sit there. We are not so big business yet, so whatever benefit I will gain from tax optimisation I will lose to sustain the company and its service providers in UAE.

Based on my understanding of what I found on these forums re how Maltese scheme works, I just need a trusted person, who is not a maltese person, who will be a UBO of my Belieze company. Then I will issue a credit card to that company and hand it over to myself/my husband. Like that the money will be claimed by Belize company from Maltese company. After they will be used just via credit card issued in the name of the director of such Belize company.

Do you see any issues here?

Thanks