Need advice. Freelancer from Non-EU country

[Ethernity4ever]

Hello,

I am a freelancer from Serbia, this year my country adopted a rule to start taxing freelancers around 65% of their income.
My current income is around 3k USD per month (if this is relevant for any banking systems or companies)

I have been using Payoneer without any issues, however, they have opened offices in Serbia and this causes concern for me.

I was thinking of opening up an LLC in the USA, however, I was advised that the company card that I get should not be used for grocery shopping and other common things like that.

I am looking into a solution to be able to get paid and receive a credit card that can be used both online and locally. I am ok with opening a company, or just a bank account somewhere. I have been looking into various options but all of this seems pretty overwhelming without any additional information.

Could anyone please help and suggest some solutions that would be best for my case?
Thank's in advance!

 

[Jerry1911]

Have you thought about opening a regular limited company instead (d.o.o)? Tax rate should be way smaller than 65%.

 

[Ethernity4ever]

I would honestly like to avoid my country as much as possible due to the constant changes they are forcing.

 

[CyprusLawyer101]

What is your type of work?

 

[Jerry1911]

I would honestly like to avoid my country as much as possible due to the constant changes they are forcing.

Fair enough. But my experience has showed this can be easily silved by having a well connected accountant and lawyer on the payroll.

Example from Croatia: company was about to get fined for some bulls**t by the state, we got a good (famous if you will) lawyer to draft a nice letter as a reply and the authorities fucked off right after

P.S. in this region you can cook the books as much as you want as long as you have the right connections

 

[Ethernity4ever]

What is your type of work?

Design and Game Development.

Fair enough. But my experience has showed this can be easily silved by having a well connected accountant and lawyer on the payroll.

Example from Croatia: company was about to get fined for some bulls**t by the state, we got a good (famous if you will) lawyer to draft a nice letter as a reply and the authorities fucked off right after

P.S. in this region you can cook the books as much as you want as long as you have the right connections

I wish it was like that here. Here they only take anything that you can. Some people end up paying taxes they didnt even know they had, if you don't pay em, they just keep adding the fee because you are late with the payment =/

 

[CyprusLawyer101]

If you are willing to incorporate abroad then you will be able to run everythinf through a company and use a card linked to your company's account. Since Serbia has no CFC rules you could with minimum substance and shift of operation abroad create a set up and probably employ yourself in the company. If you would be interested to discuss further, I would be happy to PM you.

 

[karishi]

One thing which could be safe and not too expensive would be a UAE residency with a remote working visa and a LLC in the caribbean ( which are more expensive than USA LLCs but are safer if you work with the US ).
Breakdown of costs:
LLC in San Vincent and the grenadines - 1k USD A year
Remote working visa + insurance in the UAE - 1k USD a year
2 X 15 days periods to keep the uae residency valid - 3k USD a year
The problem is that to get the remote working visa you need 5k a month...

 

[Jerry1911]

@karishi why SVG and not some other LLC jurisdiction, or a LLP in UK or Canada even?

 

[Ethernity4ever]

@CyprusLawyer101, I am interested, feel free to PM me.

As for the UAE, unfortunately, that's a bit outside of my pay range at the moment. It might go higher in the future, but at the moment it's something I can't do. I have been thinking about a company + companies card, but I just don't know where (what country) or how to even start.

 

[Ethernity4ever]

@karishi, You mentioned UAE, but your 1st cost is LLC in San Vincent and the grenadines - 1k USD A year, did you mean this as a different approach instead of the UAE or?

 

[CaptK]

UK Ltd would work perfectly for him.

 

[karishi]

@karishi, You mentioned UAE, but your 1st cost is LLC in San Vincent and the grenadines - 1k USD A year, did you mean this as a different approach instead of the UAE or?

No it's part of the approach, a LLC is a passthrough entity, so you need to be living in a country where you don't have to pay taxes. Not sure what would happen with a LLC and a country with no CFC rules like Thailand.

@karishi why SVG and not some other LLC jurisdiction, or a LLP in UK or Canada even?

because tht's what I use, not too much experience with Canda and UK, also from an accounting perspective. And not sure what would happen if you had a LLP in Canada and UK and did business with companies in Canada and UK, I'm quite sure I would not do business with SVG.

 

[JimBeam]

You could maybe setup a Romanian micro company that is taxed at 3% on gross income up to 1 million euros (in your case €90/month in taxes + other expenses).
It's probably not a perfect solution but it might work for you for next couple of years until you find something better.

All other options like UAE or Cyprus will be significantly more expensive and more complicated and are not worth it for this kind of money (€3k/month).
Especially stay away from having 2 companies as that will be even more expensive (It may be okay only if one of these is US/UK as that one might be cheaper to maintain).

Feel free to contact me on JimBeam1795[@]protonmail.com, brate

 

[Ethernity4ever]

@JimBeam thanks for the suggestion, I will think it through.

Unrelated to that, I have been looking at many other options,

Does anyone have any reasons why for instance Anguilla, Belize, or Saint Vincent would be a bad choice?
Even Marshal Islands or the British Virgin Islands look promising.

Any thoughts on any of those? They honestly seem like the perfect candidate.

 

[Jerry1911]

Will your clients be able to accept invoices issued by a company from one of those jurisdictions?

And more importantly, where exactly are you planning on opening a bank account for such company in combination with a Serbian passport?

I agree with JimBeam, Romania is an option. As long as you find a Romanian bank willing to open a business bank account for a non-resident UBO with a Serbian passport. Not saying it's impossible, in fact your chances are much higher than getting a bank account for a regular IBC, but it might not be easy.

Have you talked with a Serbian tax advisor?

Can't edit my post anymore. Do you have relatives abroad that could open a company elsewhere, with you as the beneficiary?

 

[JimBeam]

Alternatively, you cold register in Serbia as sole proprietorship ("pausal"). That will cost you about €300 - 350/month and for that get health care, pension and unemployment insurance and income taxes and be perfectly clean. As long as your employer is outside of Serbia they will never check you for "independence test" and you'll be just fine. And that's basically the only cost you'll have. You'll have your money clean and legit.

In your case that's about 10% or about 1 salary per year and you'll actually get "something" for that money.
I really doubt you'll find a better deal than that. In other places you'll end up paying more and you'll get nothing in return.

Buy, I guess you already know this...

 

[karishi]

Alternatively, you cold register in Serbia as sole proprietorship ("pausal"). That will cost you about €300 - 350/month and for that get health care, pension and unemployment insurance and income taxes and be perfectly clean. As long as your employer is outside of Serbia they will never check you for "independence test" and you'll be just fine. And that's basically the only cost you'll have. You'll have your money clean and legit.

In your case that's about 10% or about 1 salary per year and you'll actually get "something" for that money.
I really doubt you'll find a better deal than that. In other places you'll end up paying more and you'll get nothing in return.

Buy, I guess you already know this...

For me for this kind of money is enough to just take residency somewhere outside your country, get paid on Transferwise making invoices under your name, and live under the radar. It's as safe as any other solution. I mean, if you live as a digital nomad and are not resident anymore in your home country, with no ties to it, and make 35k a year, no one will bother you. The serbian solution would be clean if you live 6 months a year in serbia, at that point you would definitely be clean, but if you don't do that, I don't think it changes much, because you can't do that and then live 10 months a year in your home country or in any other country, as that would trigger worldwide tax residency.
It all depends where you want to live.