Question Tax Strategy for Zero Tax UAE & Estonia Setup

[MiddleEuroAsia]

How do you get official residency in Thailand though?

Best way to get it is via the Thailand Elite Visa program.

 

[rowena]

OP should not forget that if he lives permanently in UAE, then his estonian company will however follow UAE laws. It becomes a permanent establishment in UAE because he is running it from there. Unless he is not there permanently.

Thanks for the information. Can you also give more details about this? I have 2 companies in UAE and they should be considered as permanent establishments in the UAE. I don't pay VAT or kind of income/corporate tax because of UAE laws.

 

[MiddleEuroAsia]

Thanks for the information. Can you also give more details about this? I have 2 companies in UAE and they should be considered as permanent establishments in the UAE. I don't pay VAT or kind of income/corporate tax because of UAE laws.

I guess he means that If you manage your Estonian company from the UAE and you live in the UAE most of the time, then it's more likely that your Estonian company would be considered a UAE company from a tax perspective because of PE (permanent establishment) laws.

But you don't have to worry about that as you'll pay 0% taxes on any income in the UAE whether it's personal, corporate or whatever.

 

[orangeye]

How do you get official residency in Thailand though?

Wonder the same, have been around for long many posted that they have a Thai residency.

 

[Runway]

It's all good, but is there any advantage doing this over a more tried and tested UK non-res LLP ? Unless you are a UK national...

 

[Marzio]

is there any advantage

LLP needs 2 members

 

[Runway]

LLP needs 2 members

True, however the second partner can be a company, given OP mentioned having already 2 UAE companies. I just find using a UK LLP would be more clear cut for the case being debated here

 

[rowena]

True, however the second partner can be a company, given OP mentioned having already 2 UAE companies. I just find using a UK LLP would be more clear cut for the case being debated here

I didn't check UK LLP but 2 member requirement looks like extra paperwork. Are there any benefits UK LLP over Estonia company? I am receiving money from Ireland companies(Google & Apple) and the UK will exit the VAT regime next month. I invoice with 0% VAT(B2B intra-community) but I'm not sure how Brexit will change this.

 

[Runway]

I didn't check UK LLP but 2 member requirement looks like extra paperwork. Are there any benefits UK LLP over Estonia company? I am receiving money from Ireland companies(Google & Apple) and the UK will exit the VAT regime next month. I invoice with 0% VAT(B2B intra-community) but I'm not sure how Brexit will change this.

The benefit depends on the use you want to do, LLP is completely tax transparent and it's crystal clear profits are distributed to members without any limitations and tax-wise only members are taxed based on their place of residence. Adding a second members to the LLP is straightforward, not much of a paperwork. I assume requirements on accounting are similar to an Estonian company, no shareholder privacy in both cases.

 

[rowena]

@Runway
Thanks, I will check this. Do you know any good full package(formation+accounting) service provider like Xolo for UK companies?

 

[daxbr]

Wonder the same, have been around for long many posted that they have a Thai residency.

In order to get Thai permanent residence, one need to have work visa, work permit, work for 3 years and pass language test. All other visas (spousal, retirement, elite) do not qualify.

Some countries accept 1 year visas as proof of residence, others like Canada do not.

 

[coq]

Is there any disadvantage of using an US LLC? An LLC from New Mexico would also provide privacy besides taxes being passthrough.
If someone is living in a territorial taxing country with zero taxes for foreign income, wouldn't a NM LLC be offering both privacy and 0 taxes?

 

[Runway]

Is there any disadvantage of using an US LLC? An LLC from New Mexico would also provide privacy besides taxes being passthrough.
If someone is living in a territorial taxing country with zero taxes for foreign income, wouldn't a NM LLC be offering both privacy and 0 taxes?

Good suggestion, may be a bit limited in terms of banking options if you can't get an EIN, but from what I read TW would probably open to a NM LLC

 

[nomad999]

I have met with their tax advisors via their online consulting service and the tax advisor I met confirmed that this would work and mentioned that a lot of their customers run Estonian companies from Thailand, and pay themselves a salary tax-free from an Estonian point of view + no tax in Thailand as it’s considered foreign-sourced and no CFC rules. I

You get taxed in Thailand on foreign income remitted in the kingdom during the year of assessment.
You have to keep your money out of the country until the next year for it to be tax free. You could play around that with debt.
Also Thailand has capital gains on crypto at 15% where this rules doesnt apply has the blockchain is everywhere as they said a few years back.
And technically work performed while inside the country is taxable, so be careful there if you get paid a salary while staying in Thailand full time.
Most people living in thailand on this break the law without knowing it, they get away because there is zero enforcement.

 

[nomad999]

How do you get official residency in Thailand though?

Over 182 days in the country.
Remit over 10-15k of income.
Declare and pay tax on the amount.
remitted + accountant fees.
Get a certificate of residency.

Elite visa allows you to stay up to 365 consecutive days in the country.

 

[coq]

Good suggestion, may be a bit limited in terms of banking options if you can't get an EIN, but from what I read TW would probably open to a NM LLC

I got an EIN without any hassle. And even with an EIN the neobanks in the US are giving me quite a hard time. Some of them are even asking SSN and ITIN, even though that is not applicable at all for foreign-owned LLCs as non-residents don't have to pay taxes in the US.
The only one that opened me an account without any hassles was TW.

But other banks like Mercury, just rejected me because my business wasn't US based.

 

[Cocopops]

@rowena did you succeed with your estonian-UAE 0% tax strategy? I would be happy to hear some udaptes.

 

[joffreylol]

@rowena did you succeed with your estonian-UAE 0% tax strategy? I would be happy to hear some udaptes.

I'm wondering the same. Next year's CIT tax could maybe complicate this setup due to PE, but maybe it shouldn't change much if you are only receiving salary even with 9% CIT

 

[Marzio]

Next year's CIT tax could maybe complicate this setup due to PE

Next year the 0% tax strategy on salaries will not work anymore.

 

[rowena]

@rowena did you succeed with your estonian-UAE 0% tax strategy? I would be happy to hear some udaptes.

I went with UK LLP instead of an Estonian company. It is cheaper, faster and still has 0% tax but I will close it before 2024 because it will be subject to CT starting from 01/2024.

Next year's CIT tax could maybe complicate this setup due to PE, but maybe it shouldn't change much if you are only receiving salary even with 9% CIT

I expect the same.

Next year the 0% tax strategy on salaries will not work anymore.

Why? Salaries will not affect from UAE CT.