LLC for Consulting company...where?

[reystar22]

Hello

I have a consulting company in Greece but the tax here is just to god damn high. I am looking for a tax free solution like Delaware or maybe Wyoming would be better? What do you think?

 

[Fulton Abraham Sanchez]

Hello

I have a consulting company in Greece but the tax here is just to god damn high. I am looking for a tax free solution like Delaware or maybe Wyoming would be better? What do you think?

Rey, hi.
To open an offshore company, in USA we suggest to be open in Delaware or Wyoming. If you open an US LLC, profits are taxable when income comes from US clients. Only income earned outside of the US for an LLC with a foreign member is not taxable.
Wyoming is 0% as long meets the criteria to not be involve in US business.

 

[reystar22]

Rey, hi.
To open an offshore company, in USA we suggest to be open in Delaware or Wyoming. If you open an US LLC, profits are taxable when income comes from US clients. Only income earned outside of the US for an LLC with a foreign member is not taxable.
Wyoming is 0% as long meets the criteria to not be involve in US business.

Hello

Thanks for your reply, so between the two, which one would be better / faster / less tax etc? I will be the only member of the company

 

[reystar22]

Sorry as per my understanding then Wyoming is the way to go since 0% TAX?? My consulting is in Middle East countries and in Europe

 

[saintjohnny]

Rey, hi.
To open an offshore company, in USA we suggest to be open in Delaware or Wyoming. If you open an US LLC, profits are taxable when income comes from US clients. Only income earned outside of the US for an LLC with a foreign member is not taxable.
Wyoming is 0% as long meets the criteria to not be involve in US business.

Just wondering why you didn't suggest New Mexico?

 

[legrant]

Sorry as per my understanding then Wyoming is the way to go since 0% TAX?? My consulting is in Middle East countries and in Europe

When creating a US company and you're the only owner of it, it will be considered a disregarded entity and all the profit the company generates will be taxed as personal income in your home country, which means you're going to end up paying the same taxes you're paying now. However, you can also make your LLC be taxed as a corporation, which will pay the corporate tax in the US (21%) and you will pay dividend taxes (5% in greece) in your home country when receiving the dividends.

 

[Sols]

When creating a US company and you're the only owner of it, it will be considered a disregarded entity and all the profit the company generates will be taxed as personal income in your home country, which means you're going to end up paying the same taxes you're paying now. However, you can also make your LLC be taxed as a corporation, which will pay the corporate tax in the US (21%) and you will pay dividend taxes (5% in greece) in your home country when receiving the dividends.

Just to add to this — the LLC would be tax resident in Greece and have to pay Greek corporate tax. If there is a double taxation treaty between US and Greece, it can be leveraged to offset taxes paid in the US and only pay the remainder in Greece. So there are absolutely zero (legal) tax savings to be had from the proposed setup.

Basically, @reystar22 , this isn't how the world works anymore. It's not the 90s or early 00s anymore. You can't just set up an offshore company and not pay tax. Tax residence, CRS/AEOI, and other exchange of information mechanisms will come bite you eventually.

Have you considered relocating to maybe Cyprus or Malta and benefit from the low tax regimes there?

 

[reystar22]

When creating a US company and you're the only owner of it, it will be considered a disregarded entity and all the profit the company generates will be taxed as personal income in your home country, which means you're going to end up paying the same taxes you're paying now. However, you can also make your LLC be taxed as a corporation, which will pay the corporate tax in the US (21%) and you will pay dividend taxes (5% in greece) in your home country when receiving the dividends.

Just to add to this — the LLC would be tax resident in Greece and have to pay Greek corporate tax. If there is a double taxation treaty between US and Greece, it can be leveraged to offset taxes paid in the US and only pay the remainder in Greece. So there are absolutely zero (legal) tax savings to be had from the proposed setup.

Basically, @reystar22 , this isn't how the world works anymore. It's not the 90s or early 00s anymore. You can't just set up an offshore company and not pay tax. Tax residence, CRS/AEOI, and other exchange of information mechanisms will come bite you eventually.

Have you considered relocating to maybe Cyprus or Malta and benefit from the low tax regimes there?

The LLC will be a tax resident in US, i will open an EIN there...i will not be transferring money to greece

What about what @FAS said on his post? he said 0% TAX for non US business. Also, when making a company in the US they dont ask me for my TAX ID in Greece, so i hope that US will not be having to give info to Greece about my business

 

[Sols]

The LLC will be a tax resident in US, i will open an EIN there...i will not be transferring money to greece

Do you live in Greece? Do you control the company from Greece? Do the company's activities take place in Greece? If so, the company is tax resident in Greece. Just ask any Greek lawyer or tax adviser.

Why do you think anyone would pay any tax anywhere in the world ever if this were possible? It's 2021, not 1991.

Furthermore, is it clear how an LLC treated under Greek law? Is it considered a partnership or a stock company? If it's a partnership, you still have to pay personal income tax. If it's a stock company, you have to pay Greek corporate income tax and any taxes due on dividends or salary paid to yourself.

What about what @FAS said on his post? he said 0% TAX for non US business. Also, when making a company in the US they dont ask me for my TAX ID in Greece, so i hope that US will not be having to give info to Greece about my business

He's absolutely right, but also a little misleading. There is no tax — in the US. That doesn't change your legal obligations at home in Greece.

Regarding exchange of information, you might want to read about FATCA, CRS, and tax residence in general before you commit tax fraud. Or don't, and see what happens in a couple of years.

 

[reystar22]

Do you live in Greece? Do you control the company from Greece? Do the company's activities take place in Greece? If so, the company is tax resident in Greece. Just ask any Greek lawyer or tax adviser.

Why do you think anyone would pay any tax anywhere in the world ever if this were possible? It's 2021, not 1991.

Furthermore, is it clear how an LLC treated under Greek law? Is it considered a partnership or a stock company? If it's a partnership, you still have to pay personal income tax. If it's a stock company, you have to pay Greek corporate income tax and any taxes due on dividends or salary paid to yourself.


He's absolutely right, but also a little misleading. There is no tax — in the US. That doesn't change your legal obligations at home in Greece.

Regarding exchange of information, you might want to read about FATCA, CRS, and tax residence in general before you commit tax fraud. Or don't, and see what happens in a couple of years.

I live in Greece
I will control the company online i travel a lot
The company's activities are not taking place in Greece, my customers are from Middle East mostly, so for example the money will go from Morocco to US bank.

Plus i wont send money to Greece

 

[Sols]

OK, good luck! I guess the law doesn't apply to you.

https://www.oecd.org/tax/automatic-...stance/tax-residency/Greece-Tax-Residency.pdf

According to para. 3 & 4 of the same article of the Hellenin ITC, a legal person or a legal entity is considered as tax resident in Greece for any tax period, provided that:
a) it has been incorporated or established according to the Greek legislation,
b) it has its registered seat in Greece, or
c) the place of effective management is located in Greece for any period during the tax year.

The place of effective management is located in Greece on the basis of the actual facts and circumstances, taking into account mainly the following:
− the place of exercising the day-to-day management,
− the place of taking strategic decisions,
− the place where the annual general meeting of shareholders or partners is held,
− the place where the books and records are kept,
− the place where the meeting of the members of the Board of Directors or other executive management board takes place,
− the residence of the members of the Board of Directors or other executive management board.

 

[legrant]

I live in Greece
I will control the company online i travel a lot
The company's activities are not taking place in Greece, my customers are from Middle East mostly, so for example the money will go from Morocco to US bank.

Plus i wont send money to Greece

To make it much clear for you. You're going to pay taxes (personal income or corporate) to the country you're a tax resident on, period.

 

[fshore]

profits are taxable when income comes from US clients. Only income earned outside of the US for an LLC with a foreign member is not taxable.

It's strange that a cpa gives out incorrect advice like this.
It's not where the clients are that determine the taxation, its where the services are performed.
A foreigner can have us clients without paying us tax when he performs the services outside the us. The llc is disregarded so the taxation of the member is the same as if the llc didn't exist.