HK/SG Ltd + Which country for personal tax residency?

[frankx1]

Hello,

I'm planning a structure for a B2C online business, customers mainly in the EU.
My plan is: HK/SG company + personal tax residency in Thailand, Philippines, Malaysia etc.

The real value creation in the business happens outside of the any of the mentioned countries through third party contractors. So its not like a coaching business where the coach is sitting in TH all day doing video calls and saying income is not TH-sourced.

What countries of the mentioned ones for personal tax residency would you say are the best in terms of relaxed territorial taxation of profits made in the HK/SG company and distributed via dividends? In which country do you guys think is it most unlikely that some government just randomly changes their way of handling things and going into the opposite direction?

Thanks!

 

[Marzio]

Estonian company with Philippines residency.

You would get a EU VAT, EU Stripe, EU PayPal and 0% tax on salary paid in Philippines.

@backpacker seems to know a lot about Philippines

https://www.offshorecorptalk.com/threads/wtf-portugal.39225/page-2#post-236146

 

[backpacker]

In which country do you guys think is it most unlikely that some government just randomly changes their way of handling things and going into the opposite direction?

Philippines!
Nothing goes fast, everything is blocked by Senate due to obvious reasons.
TRAIN (Tax Reform for Acceleration and Inclusion) has been drafted in 2017 and -until today- has only partially passed Senate. All very predictable.
Moreover, the new president is not exactly interested in reinventing the wheel. Look up local history and you understand that he has his reasons.

So, if you like to live in an affordable and relatively stable country (typhoons are actually the only major disturbance) than try the Philippines.
Depending on your age, permanent residency is easy to get.

 

[frankx1]

Estonian company with Philippines residency.

You would get a EU VAT, EU Stripe, EU PayPal and 0% tax on salary paid in Philippines.

@backpacker seems to know a lot about Philippines

https://www.offshorecorptalk.com/threads/wtf-portugal.39225/page-2#post-236146

Thanks. Do you think Estonian company is a good idea when your profits are around $1m yearly and you pull out almost the whole profit as salary with only one employee (yourself)? Maybe I'm wrong but it seems like kinda too easy, especially as a EU company.

Philippines!
Nothing goes fast, everything is blocked by Senate due to obvious reasons.
TRAIN (Tax Reform for Acceleration and Inclusion) has been drafted in 2017 and -until today- has only partially passed Senate. All very predictable.
Moreover, the new president is not exactly interested in reinventing the wheel. Look up local history and you understand that he has his reasons.

So, if you like to live in an affordable and relatively stable country (typhoons are actually the only major disturbance) than try the Philippines.
Depending on your age, permanent residency is easy to get.

Thanks, sounds amazing!

 

[Dandyline]

Hello,

I'm planning a structure for a B2C online business, customers mainly in the EU.
My plan is: HK/SG company + personal tax residency in Thailand, Philippines, Malaysia etc.

The real value creation in the business happens outside of the any of the mentioned countries through third party contractors. So its not like a coaching business where the coach is sitting in TH all day doing video calls and saying income is not TH-sourced.

What countries of the mentioned ones for personal tax residency would you say are the best in terms of relaxed territorial taxation of profits made in the HK/SG company and distributed via dividends? In which country do you guys think is it most unlikely that some government just randomly changes their way of handling things and going into the opposite direction?

Thanks!

The most important thing is your access to EU PSPs and Banks. Can be difficult with e NON-EU company in the setup, you should probably include that.

 

[Marzio]

you pull out almost the whole profit as salary

You can't pull out anything that's not considered a reasonable salary.

You can't pay yourself a $1M salary obviously BUT if you are ok in taking out $5K and reinvest the rest then it works.

If you instead want to see $1M in your bank account then you could form a UK LLP which is tax transparent and still gives you access to Stripe UK (higher fees than Stripe EU), PayPal UK (currency conversion for EUR withdrawals) and you'll have to register for VAT in EU.

 

[TheCryptoAnt]

Hello,

I'm planning a structure for a B2C online business, customers mainly in the EU.
My plan is: HK/SG company + personal tax residency in Thailand, Philippines, Malaysia etc.

The combo HK + TH is ver common w the HK tax exemption (careful here, do some research cause if they dont grant it then you royally fucked).

Also most crypto traders I know in TH use rather SG or UAE. SG being cheaper obvs and dont have to go to UAE every 6 months but theres reporting involved.

What countries of the mentioned ones for personal tax residency would you say are the best in terms of relaxed territorial taxation of profits made in the HK/SG company and distributed via dividends? In which country do you guys think is it most unlikely that some government just randomly changes their way of handling things and going into the opposite direction?

TH imo, I dont think they gon change anything that will ultimately hurt them and the expat community there is mostly digital nomads on Elite visas.
PH is great too cause things are so mismanaged that you get the heads up waaaay before anything changes and can prepare in advance.

 

[frankx1]

The combo HK + TH is ver common w the HK tax exemption (careful here, do some research cause if they dont grant it then you royally fucked).

Also most crypto traders I know in TH use rather SG or UAE. SG being cheaper obvs and dont have to go to UAE every 6 months but theres reporting involved.

Do you know how likely it is to get SG fully down to 0% CIT/tax at all? I heard its not as easy in many cases.

 

[Marzio]

Do you know how likely it is to get SG fully down to 0% CIT/tax at all?

What's the logic behind even hoping to get CIT down to 0% by using a SG company to sell B2C in EU?

 

[TheCryptoAnt]

Do you know how likely it is to get SG fully down to 0% CIT/tax at all? I heard its not as easy in many cases.

i mean ik its technically possible but i dont know nobody who runs that set up

more info here

What's the logic behind even hoping to get CIT down to 0% by using a SG company to sell B2C in EU?

but also this

what are u trying to achieve?

 

[Mercury]

Also most crypto traders I know in TH use rather SG or UAE. SG being cheaper obvs and dont have to go to UAE every 6 months but theres reporting involved.

According to @Fred, UAE company package (including substance?) yearly renewal/maintenance is about 5K USD (18.450 AED). How much is it yearly to maintain a SG Private Ltd Company including nominee director and audit/reporting fees?

 

[TheCryptoAnt]

https://www.corporateservicessingap...e-to-company-incorporation-fees-in-singapore/
depends on CSP obvs i just found that

 

[Marzio]

How much is it yearly to maintain a SG Private Ltd Company including nominee director and audit/reporting fees?

Having a nominee director is a surefire way to have your company considered non-resident in SG

https://www.iras.gov.sg/taxes/corpo...rporate-income-tax/tax-residency-of-a-company

 

[Mike Forman]

According to @Fred, UAE company package (including substance?) yearly renewal/maintenance is about 5K USD (18.450 AED). How much is it yearly to maintain a SG Private Ltd Company including nominee director and audit/reporting fees?

SG with nominee director will cost you the same without substance. Depending on the number of transactions and revenue normally any agent will require you they do the accounting and filing for you.

Personal income tax is also high for a non resident director, 22pct and next year 24pct.

Obtaining offshore status is as good as impossible as well.

 

[Fred]

According to @Fred, UAE company package (including substance?) yearly renewal/maintenance is about 5K USD (18.450 AED). How much is it yearly to maintain a SG Private Ltd Company including nominee director and audit/reporting fees?

Doesn't make sense to compare SG with UAE when it comes to taxes and running costs - SG has no chance as the SG Setup has at least the same operating costs and SG is not 0% Tax.

SG with nominee director will cost you the same without substance. Depending on the number of transactions and revenue normally any agent will require you they do the accounting and filing for you.

Personal income tax is also high for a non resident director, 22pct and next year 24pct.

Obtaining offshore status is as good as impossible as well.

That's it.

Otherwise we wouldn't get approached at least once a week from an most of the time EU National living for long time in SG but struggling around with the CT in SG - they usually have an old school Seychelles + Belize Bank Account or whatever structure and want to get done something proper with a fully fledged transactional Bank Accoun in a Retail Bank.

 

[MiddleEuroAsia]

You can't pull out anything that's not considered a reasonable salary.

Not necessarily, in Estonia there is this great thing where you can actually "invest" your profits and you don't have to pay corporate tax on them at all, if you don't wish to sell them, or distribute the profits, see:
https://www.xolo.io/zz-en/faq/xolo-...article/can-i-invest-from-my-estonian-company
quote:

your Estonian company is allowed to make the following investments:

• Buy-sell shares in publicly traded companies and funds
• Buy-sell cryptocurrencies for investment purposes
• Invest in start-ups or other private companies registered in the EU or in the UK (either a convertible loan or equity), receiving a minority stake and no controlling rights (less than 20%)
• Lending via internationally recognized crowd-funding platforms
• Lending to start-ups or other private companies registered in the EU or in the UK based on a loan agreement (incl. parties details, loan amount, market interest rate, payment deadline)
• Buying real-estate and land in Estonia

This means the following investments are not allowed (not an exhaustive list):

• Buying physical gold/silver
• Buying a controlling/majority share in another company
• Lending to a friend or any other individual directly
• Lending to yourself (as a shareholder / board member of the company)

So, the most appealing options are the crypto, lending and investing in private companies, the catch is, your crypto investments cannot becomes the core business of the company, since this will require an activity license. So around 15-20% of your business profits should be fine.
Then you can make 3-4 UK LLPs which then you can invest "part" of your Estonian profits into (less than 20% in each, so in total around, 40-70% of your profits)
and there is also the loan part where the other party (your own "anonymous" company) can technically default on the loan, and voila, you can do whatever after that.
and of course, there is also your salary, which should be tax free, if you live in a tax friendly country.
Every option from the above Quote has it's workarounds which will help you reduce your tax burden by quite a margin. But it's more complex, than say, opening a UAE company where you can have a clear 0% CIT.

 

[frankx1]

Thanks guys for all the valuable answers.

You can't pull out anything that's not considered a reasonable salary.

You can't pay yourself a $1M salary obviously BUT if you are ok in taking out $5K and reinvest the rest then it works.

If you instead want to see $1M in your bank account then you could form a UK LLP which is tax transparent and still gives you access to Stripe UK (higher fees than Stripe EU), PayPal UK (currency conversion for EUR withdrawals) and you'll have to register for VAT in EU.

UK LLP also sounds interesting. Do you know if its possible to run the LLP so that the identity of the real owner is at least not visible to the general public?
Like:
Payments
Stripe
Paypal

Anonymity
Maybe put some BVI(or other offshore locations) companies as partners behind the LLP

Banking
I guess its only possible to get some kind of EMI banking here?

Then distributing all profits from the LLP EMI -> Partners EMI (I guess?) -> Own bank accounts somewhere safe

Not necessarily, in Estonia there is this great thing where you can actually "invest" your profits and you don't have to pay corporate tax on them at all, if you don't wish to sell them, or distribute the profits, see:
https://www.xolo.io/zz-en/faq/xolo-...article/can-i-invest-from-my-estonian-company
quote:

So, the most appealing options are the crypto, lending and investing in private companies, the catch is, your crypto investments cannot becomes the core business of the company, since this will require an activity license. So around 15-20% of your business profits should be fine.
Then you can make 3-4 UK LLPs which then you can invest "part" of your Estonian profits into (less than 20% in each, so in total around, 40-70% of your profits)
and there is also the loan part where the other party (your own "anonymous" company) can technically default on the loan, and voila, you can do whatever after that.
and of course, there is also your salary, which should be tax free, if you live in a tax friendly country.
Every option from the above Quote has it's workarounds which will help you reduce your tax burden by quite a margin. But it's more complex, than say, opening a UAE company where you can have a clear 0% CIT.

That's sounds very creative, thanks!

 

[Marzio]

Then you can make 3-4 UK LLPs which then you can invest "part" of your Estonian profits into (less than 20% in each, so in total around, 40-70% of your profits)
and there is also the loan part where the other party (your own "anonymous" company) can technically default on the loan, and voila, you can do whatever after that.

Thanks for the nifty little trick right there

 

[TheCryptoAnt]

Then you can make 3-4 UK LLPs which then you can invest "part" of your Estonian profits into (less than 20% in each, so in total around, 40-70% of your profits)
and there is also the loan part where the other party (your own "anonymous" company) can technically default on the loan, and voila, you can do whatever after that.
and of course, there is also your salary, which should be tax free, if you live in a tax friendly country.
Every option from the above Quote has it's workarounds which will help you reduce your tax burden by quite a margin. But it's more complex, than say, opening a UAE company where you can have a clear 0% CIT.

this is what i come to this forum for
clap clap clap

 

[Marzio]

UK LLP also sounds interesting. Do you know if its possible to run the LLP so that the identity of the real owner is at least not visible to the general public?

You can, for example by using New Mexico US LLC BUT then again you could have some problems when opening a bank account with EMI.

Overall it's more hassle than the Estonian model.

If you are willing to sacrifice some % of the profits i guess you could do even without a company by using Xolo Go

https://www.xolo.io/zz-en/go