Tax minimisaiton when cashing out crypto?

Discussion in 'BitCoins, ALTCoins, Exchange Services & Related' started by Jessie, Oct 26, 2018.

  1. Jessie

    Jessie Active Member

    What would be the most optimal way tax wise to cash out crypto that you've acquired at much lower price, hence the profit is significant? For EU based person.

    I'm thinking for incorporating a company in jurisdiction where the tax on foreign income is 0% and then pay myself as dividend but not sure if it's legal to transfer my crypto to the company just like that with the sole purpose of the company to sell it?

    Actually can a company with no actual activity just sell it, declare 0$ domestic income and pay everything as dividend to the owner of the company?

    Know a better way?
  2. sialala

    sialala Building Trust Entrepreneur

    Good question. I am looking for an answer too.
  3. Jessie

    Jessie Active Member

    If someone here have a solution for this I'm looking to hire him.
  4. jimhoe

    jimhoe Member

    Don't know if this is any help but why not just keep it as true usd maybe tether (tether is a bit doggy )and cash out small amounts at a time?.Wirex is an option but I think they limit you on how much u can cash out a year U could also travel to a place like Switzerland sell your bitcoin there and deposit the funds in a Swiss bank. Not sure how helpful the advice is but it options
  5. Jessie

    Jessie Active Member

    I need a way to cash it out legally and pay tax, so i can spend those money and have source of income to show if asked.
  6. negon

    negon hannibal the cannibal Mentor Group Business Angel

    So you can transfer your money to Mister Tango and cash out to your bank account, there are no limits for this! I have at least not faced any limits!

    However, to minimize the Tax you will need to speak with a local consulatancy in TAX he will be able to help you if it's possible.
  7. Jessie

    Jessie Active Member

    Well have you done 6 or 7 digits with mistertango? I doubt they won't freeze my account if I do that and ask for all kinds of stuff.

    For example revolut freezes your account and asks for source of income after just 15k EUR.

    Most of those emoney transmitters have about the same limits.
  8. negon

    negon hannibal the cannibal Mentor Group Business Angel

    Well, don't underestimate every one here, majority of people are small fishes but there are people around here that are doing very well and have 6 and 7 figures in volume! MT is pretty easy to work with depending on which country you come from, where the money comes from and what you tell them.
  9. Stefano3323

    Stefano3323 Active Member

    The problem is that you got the cryptos before having the company, so if you cash out you need to pay personal taxes on those. You can set up a company in Seychelles with no par-value, this would allow you to send the cryptos in the company as initial capital. From there you can set up a TW account and cash out via OTC. Otherwise having a business account on Kraken.

    BUT - if you issue dividends you will have to pay personal taxes anyway. So probably you are better off to just cash out the cryptos and pay profit taxes in your country if you must have the money as prove of income. Otherwise keep everything in the Seychelles entity and you are fine.
  10. Admin

    Admin Forum Moderator The Forum Cleaner

    How can you get crypto into Transferwise? and do you know if Kraken allow Seychelles companies? I can't find any info on their website maybe I'm missing something.
  11. Stefano3323

    Stefano3323 Active Member

    You need to use an OTC as if there is any mention of crypto in the transfer, TW will freeze your account. So far didn't have any problem to cash out 5 digits. Never tried with anything around 6 so not sure if that would work the same.

    Regarding Kraken, no, but from their business setup it seems there are no limitation, so I assume it will be possible. They don't give any problems to HK if that is of interest.
  12. negon

    negon hannibal the cannibal Mentor Group Business Angel

    please elaborate what is OTC ?
  13. Stefano3323

    Stefano3323 Active Member

    Over the counter. Like localbitcoin for example. Basically solutions that are no exchanges but where transactions are P2P.
  14. totlori9

    totlori9 Banned User Entrepreneur BANNED MEMBER

  15. Nanoo

    Nanoo Active Member

    For those with +6-7 digits, the best would be to buy real estates: Buying property with bitcoin
    For the Seller it allow a tax optimization as well as he could save the profit in True USD without paying tax.

    Don't forget why bitcoin exist guys, don't screw up by trying to cash out your millions to get this shitcoin (FIAT)
  16. Jessie

    Jessie Active Member

    Well, teach me master :)

    Im not underestimating anyone, I just would feel uneasy to put it mildly to transfer large amounts through EMIs like MisterTango. Not to mention it has mixed reputation as well.

    To make it even worse my money will be coming from crypto exchange and going to east europe. Fishy as fuck.
    I will be surprised if they don't freeze the funds and ask me for all kinds of stuff including anal sample.

    And to top it off I'll have to pay 10% personal capital gains, instead of 5% if it goes through a company.
    (please everyone dont start about how 10% is low enough already, i know, but if I can do better, why not, also im libetarian)

    Couple questions.
    1. If I go OTC>TW>my account, will I be able to file this as dividend at the end of the year? Money will be coming from many different individuals as opposed to from the company that I own and is paying me dividends.

    so we will have to use Kraken business acc but
    2. Won't they ask the company to prove how it made the money (crypto)
    If I say initial capital, wouldn't they ask who give them the initial capital and how he obtained it?

    3. Can I just pay as an individual the company to consult me, paying with crypto. Then the company turns around declares that all as profit, cashes out some, pays me dividend and I pay 5% tax?
    Quite obvious though, isn't it? Unless someone elses pays it with crypto for consulting?

    From my limited knowledge I see couple of problems.
    1. You buy the real estate with crypto, then you sell it for fiat. You declare that profit (how much is the profit actually?) and you pay income tax, which is not minimilisation at all, but normal tax.
    And you could still be asked from where you got the money for the property.
    Also as of 2017 most countries share bank accounts AND properties of foreign citizens to their native countries.

    Actually I don't see at all how going through a property as a means to exchange crypto to fiat helps.

    Im not forgetting why bitcoin exist, but I need to cash out some part and pay some taxes to explain my lifestyle.
  17. Nanoo

    Nanoo Active Member

    No need to sell Property for Fiat, the purpose is to hold a property instead of Crypto or Fiat and even get revenue through this property.
    If someone is willing to cash out 6-7 digits it's mainly to buy real estates.
    totlori9 likes this.
  18. Gunter

    Gunter Building Trust Entrepreneur

    can't you take this amount out in smaller portions?
    totlori9 likes this.
  19. Jessie

    Jessie Active Member

    I much prefer to hold crypto than property or fiat
    But need to cash out some part

    i can in any portions, that is not the issue, tax minimisation is