Software services between UK company and Seychelles company

[James Blake]

Hello everyone, this is my first post!

I am a software engineer based in Europe and I develop software for a -one and only- UK company Ltd.

Initially I was thinking to incorporate in Cyprus or Bulgaria, with 12.5% tax rate and 10%.

But then I thought that other cheaper jurisdictions maybe can work. (Seychelles IBC etc..)
I guess it is possible for a IBC company from Seychelles to issue invoices with a subject like that to a UK company.

I would like to ask:

Is it legal from a UK company to receive an invoice from a Seychelles offshore IBC? Would they accept it?
(So they can deduct these expenses from their income and pay less tax)

I think that most of them, don't prefer it.

Is there any other jurisdiction that is more friendly with UK ltds?

Any guides and helps would be appreciated!

 

[dotbloup]

If you have software, it means you have intangible assets. You should get familiar with Royalties. Create a Seychelles company with a nominee directory and shareholder, have your software licenses, trademarks and codes owned by the seychelles company and bill the UK company for the right of selling your software. Do this not too much. You can lower the corporate tax to 10% but no more with UK, otherwise HMRC will find it suspicious.

 

[dotbloup]

Nevertheless, the UK wanted to create a black list of tax havens to prevent that. It was just before the Brexit, now they stopped talking about tax havens. I know exactly what they want to do.

If they create a black list, then you can use a Seychelles company to invoice programming by a ghost programmer but then if their is a tax audit, it is risky.

 

[James Blake]

it means you have intangible assets. You should get familiar with Royalties. Create a Seychelles company with a nominee directory and shareholder, have your software licenses, trademarks and codes owned by the seychelles company and bill the UK company for the right of selling your software.

Actually there is no any software licenses or trademarks... Its all about development services. Thats all. A UK company pays on a monthly basis for the services.

 

[dirtyharry]

Is it legal from a UK company to receive an invoice from a Seychelles offshore IBC? Would they accept it?

If they don't have issues of accepting invoices from SC corps I just got a good idea.. thanks for posting.

 

[JohnSeed]

If they don't have issues of accepting invoices from SC corps I just got a good idea.. thanks for posting.

What's the idea? I believe that for any European company it apply that if you receive invoices from an recognized offshore jurisdiction / company the tax office will start asking question and the only guy that can help you to stay out of troubles is your accountant!

 

[dirtyharry]

My idea is simply. I want to register a company in the UK for my HYIP website. The UK company will be owned by a Seychelles company means they will be shareholder and director in the UK corp. if something goes wrong I move the money from the UK corp to the Seychelles and just register a new UK company!

 

[orangeye]

Is it legal from a UK company to receive an invoice from a Seychelles offshore IBC? Would they accept it?

There is nothing illegal to receive a invoice from the Seychelles company if you have traded with them one way or another. You just need to be prepared for questions from your local tax officer. Only do it if you have a good accountant by hand.

 

[James Blake]

You just need to be prepared for questions from your local tax officer. Only do it if you have a good accountant by hand.

Thank you for your post. I agree, but its risky for them even with a good accountant, so I will try something else.
I am closer to Bulgaria as a solution. (10% tax + 5% dividends)

 

[negon]

Thank you for your post. I agree, but its risky for them even with a good accountant, so I will try something else.
I am closer to Bulgaria as a solution. (10% tax + 5% dividends)

Same setup just with an company from Bulgaria? if so what privacy does they provide?

 

[orangeye]

Thank you for your post. I agree, but its risky for them even with a good accountant, so I will try something else.
I am closer to Bulgaria as a solution. (10% tax + 5% dividends)

What risk you think of?

 

[JohnLocke]

Is it legal from a UK company to receive an invoice from a Seychelles offshore IBC? Would they accept it?
(So they can deduct these expenses from their income and pay less tax)

It is legal and acceptable. The problem as already indicated by some members here, is that they may ask questions about the Seychelles company and who owns this company.

 

[adoffshore]

If you have software, it means you have intangible assets. You should get familiar with Royalties. Create a Seychelles company with a nominee directory and shareholder, have your software licenses, trademarks and codes owned by the seychelles company and bill the UK company for the right of selling your software

Do you know if this works 100% ?

 

[drillbill]

Hello everyone, this is my first post!

I am a software engineer based in Europe and I develop software for a -one and only- UK company Ltd.

Initially I was thinking to incorporate in Cyprus or Bulgaria, with 12.5% tax rate and 10%.

But then I thought that other cheaper jurisdictions maybe can work. (Seychelles IBC etc..)
I guess it is possible for a IBC company from Seychelles to issue invoices with a subject like that to a UK company.

I would like to ask:

Is it legal from a UK company to receive an invoice from a Seychelles offshore IBC? Would they accept it?
(So they can deduct these expenses from their income and pay less tax)

I think that most of them, don't prefer it.

Is there any other jurisdiction that is more friendly with UK ltds?

Any guides and helps would be appreciated!

Hod did you get setup? If you don't mind please share how you did would like to know please