Go offshore, what to do?

[Sophieagency]

What we are looking for


We are a (small) website design company located in Europe with a clientele primarily located in the United States. We are looking to incorporate in Cyprus and open a corresponding corporate bank account in Cyprus. In addition we are also looking for an E-commerce solution to process payments. Our average sales are 12K a month. We expect to grow to 100K a month in the next 2 years.


Our clientele and sales volume


Our typical client purchases our services on a monthly basis. Some clients pay over $2000 a month. We send clients a bill through email with an average ticket size of $400.


Taxes


We are looking to optimize our tax strategy. Questions that we have:


• How can we optimize our tax system?


• Do we have to pay taxes in the United States? (our clientele is from the US)


• What kind of taxes do we have to pay?


E-commerce solution


We are still looking for the best way to get paid by our clients. Our typical client is located in the United States and generally pays us on a weekly basis with different ticket sizes.


Questions that we have:


• What is the best way for us to receive and withdraw funds?


• What payment processor works well with a Cyprus bank account?


Possible Paypal solution


From our understanding we think Paypal might be a good solution for our needs.


Questions that we have:


• Does PayPal work with a Cyprus bank account?


• Does Paypal report sales to the IRS?


• What are the maximum amount of transactions we can process with Paypal?


• What is the maximum dollar amount we can process with Paypal?


• Will Paypal easily freeze our account since we are located in Europe, have a Cyprus bank account, do net sell tangible goods and our clientele is in the United States?


Cyprus Bank account + incorporation


Part of our strategy is to incorporate and open a Cyprus corporate bank account.


Questions that we have:


• What law firm / online service should we use to incorporate + open a bank account?


• How difficult is it to open a Cyprus bank account? What are the steps?


• What’s the level of privacy with a Cyprus corporation / bank account?


Conclusion


Problem 1: We are looking for a solution to incorporate and open a corporate bank account in Cyprus.


Problem 2: We are looking for what we are looking for a E-commerce solution (example: CCBill, PayPal, Liberty Reserve, MoneyBookers, Alertpay etc etc )

 

[JohnLocke]

TaxesWe are looking to optimize our tax strategy. Questions that we have:
• How can we optimize our tax system?


• Do we have to pay taxes in the United States? (our clientele is from the US)


• What kind of taxes do we have to pay?

Welcome aboard, I will go through your questions as the following.


As long as you are not located or a citizens of the USA you don't have to pay tax there. Actually a Cyprus company can be a good option for you since it can be registered non resident. Since your clients are outside of Cyprus this is not a problem at all. A non resident company does not pay any tax but can of course also no be registered for VAT.


Alternative could be a Seychelles company which as well don't pay any tax and which is faster and cheaper to incorporate.


For both Seychelles and Cyprus it is possible to open a offshore bank account in either Cyprus or St. Vincent or a different offshore jurisdiction.

E-commerce solution
We are still looking for the best way to get paid by our clients. Our typical client is located in the United States and generally pays us on a weekly basis with different ticket sizes.


Questions that we have:


• What is the best way for us to receive and withdraw funds?


• What payment processor works well with a Cyprus bank account?

All European payment processor will work with Cyprus companies and banks. Cyprus is part of the European Union and for that reason accepted by all European Banks and Payment processors.


There are many PSP's available, just to mention a few RBS World Pay, 2co.com Wirecard, FailsafePayment and even many more.


You can find a list of certified payment service providers in Europe here: http://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&sqi=2&ved=0CE0QFjAA&url=http%3A%2F%2Fwww.visaeurope.com%2Fidoc.ashx%3Fversion%3D-1%26docId%3D722c1918-ee68-4283-a701-6b473c2c1cdd&ei=6Lv_T87NHoqytAaN9vzQBg&usg=AFQjCNHOPKU1OklFcULh7SyqBTb9ojtvYw&sig2=YYnVOSpqYhvAUXPexlfFIw - hope the link works

 

[cangarooo]

Go offshore, what to do?


Hi Sophieagency.


Admin already provided you some ideas regarding incorporation.


From my personal experience I don't rely to much into Seychelles solution to work with US.


This may complicated especially for your customers when filling the yearly tax as some (or all) expenses may not be recognized by US IRS.


Cyprus is a good solution, to be carefully checked based on your needs.


US IRS is not against Cyprus but not really in favour.


There are anyway other solutions that you could adopt especially to work with US, in terms of reputation.


A good setup of UK LLP could be the easy way-out, if well established, you may have 0% taxes (If the members are not resident in the UK and the income and gains are not from a UK source or trade, then they will have no UK tax liability.)


Or even a Gibraltar Ltd with a flat 10% taxation for non resident may be a good alternative.


It goes without saying that in both cases you'll be entitled to open a bank account and use most of the e-payment solutions.


Whatever will be the solution you will decide to adopt (based on your needs), you'll not be liable to pay taxes to US (unless you are a US citizen or you plan to open a US company).


In another thread, i've also requested more information for e-payments as one of my customers is looking to get support and i'm not really an expert.


From what i've understood so far, PayPal is the last solution i would suggest to my customer.


It's really not flexible and frozen of amounts is their daily job.


Hope my 2cents to discussion were helpfull.


Bye


cangarooo

What we are looking for
We are a (small) website design company located in Europe with a clientele primarily located in the United States. We are looking to incorporate in Cyprus and open a corresponding corporate bank account in Cyprus. In addition we are also looking for an E-commerce solution to process payments. Our average sales are 12K a month. We expect to grow to 100K a month in the next 2 years.


Our clientele and sales volume


Our typical client purchases our services on a monthly basis. Some clients pay over $2000 a month. We send clients a bill through email with an average ticket size of $400.


Taxes


We are looking to optimize our tax strategy. Questions that we have:


• How can we optimize our tax system?


• Do we have to pay taxes in the United States? (our clientele is from the US)


• What kind of taxes do we have to pay?


E-commerce solution


We are still looking for the best way to get paid by our clients. Our typical client is located in the United States and generally pays us on a weekly basis with different ticket sizes.


Questions that we have:


• What is the best way for us to receive and withdraw funds?


• What payment processor works well with a Cyprus bank account?


Possible Paypal solution


From our understanding we think Paypal might be a good solution for our needs.


Questions that we have:


• Does PayPal work with a Cyprus bank account?


• Does Paypal report sales to the IRS?


• What are the maximum amount of transactions we can process with Paypal?


• What is the maximum dollar amount we can process with Paypal?


• Will Paypal easily freeze our account since we are located in Europe, have a Cyprus bank account, do net sell tangible goods and our clientele is in the United States?


Cyprus Bank account + incorporation


Part of our strategy is to incorporate and open a Cyprus corporate bank account.


Questions that we have:


• What law firm / online service should we use to incorporate + open a bank account?


• How difficult is it to open a Cyprus bank account? What are the steps?


• What’s the level of privacy with a Cyprus corporation / bank account?


Conclusion


Problem 1: We are looking for a solution to incorporate and open a corporate bank account in Cyprus.


Problem 2: We are looking for what we are looking for a E-commerce solution (example: CCBill, PayPal, Liberty Reserve, MoneyBookers, Alertpay etc etc )

 

[JohnLocke]

Best is to find the Payment Processor first, once accomplished, you find the jurisdiction that fits your other goals and even ask the PSP first if they will accept companies from the jurisdiction of your choice.

 

[jim]

Was this Cyprus company for US market or European market?

 

[Sany zeth]

average sale 12k a month and how much is the profit after deducting all expenses..?

 

[Anton]

Fast Answer to some of your questions: PayPal doesn't work with any Offshore Accounts/Banking related activities. Try Skrill instead of PayPal