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UK LTD company + BVI company

Discussion in 'Offshore Company formation' started by Neqzwer3, Jun 14, 2018.

  1. Neqzwer3

    Neqzwer3 New Member

    Hey,

    I looking for best way to optimize tax in UK.
    My accountant gave me idea.
    BVI as shareholder in LTD UK company.
    95% incomes goes to BVI from LTD based on license agreement.
    And later i will send money from BVI to my personal account as "loan" with 0%.

    Its right? Does anyone have experience in such optimizations?
     
    negon and W4rhol like this.
  2. symon

    symon New Member

    Hi,

    so at the end do you plan/need to reimburse the BVI?
    as it is your accountant advice, you may go for it, just be sure that you can sue him in case you get issue with hrmc... ;-)
     
  3. Banker89

    Banker89 New Member Entrepreneur

    It would work if you are not UK resident. This is a standard way of working for offshore structures. If you are UK resident it is risky though as the HMRC will claim they have the right to tax the BVI company too. If your accountant will put the advice formally in writing, go for it and you can point the finger at your accountant if you get any problems.
     
  4. Neqzwer3

    Neqzwer3 New Member

    The cost of this optimization is 8000/9000 GBP. I do not know if it's a good price. Do you know cheaper solutions to optimize tax?
     
  5. Banker89

    Banker89 New Member Entrepreneur

    I would say it all depends on you and how much tax you are going to save with it. It could be done cheaper, but then again if the accountant will take the blame if things go wrong, that is like an insurance policy that is worth paying for.
     
  6. Banker89

    Banker89 New Member Entrepreneur

    You did not tell us if you are UK resident. Also the BVI is an expensive jurisdiction, any reason why you cannot use Belize or Seychelles?
     
  7. Neqzwer3

    Neqzwer3 New Member

    I live in UK and i offer online digital services in EU countries. I looking for best way for optimize tax in my LTD company or i can open new company Offshore but where? Im newbie in offshore companies.
     
  8. Banker89

    Banker89 New Member Entrepreneur

    Do the people who are paying you care where they pay to? Do they have any restrictions on paying to non-EU companies?
     
  9. Neqzwer3

    Neqzwer3 New Member

    Our customers dont care where they pay but i have convenient payments for my clients. Our payment agents may not want to sign a contract with an offshore company
     
  10. Jon Goldberg

    Jon Goldberg New Member

    Have you considered Emirates so called offshore company with local Emirates bank account, you pay flat fee once a year, no company tax headaches,
    all your cash will be outside UK/EU, advise this with your payment agents to make sure it will work , you need to visit Emirates one time in order to open
    a bank account, all this would be much cheaper than your mentioned every year optimization 8000/9000 GBP.
     
  11. Banker89

    Banker89 New Member Entrepreneur

    The advise on Emirates is good, but it is important to change your residency too. If you set up a company in Emirates you can easily get residency there.
     
  12. Liveera

    Liveera New Member

    Hi,

    I think that's a big mistake if you follow his instruction : both of you will be placed under HRMC regulations. Why ? Because they will qualify your transfer as '' Transfer Pricing", indeed OECD Regulations are actually defining a lot of methods for those types of intellectual transfer or licence transfer from parent company to subsidiary companies due to the large amount of money gained by Google or Amazon with transfer pricing and intellectual property regulation.

    If you transfer small amount , it shouldn't be a problem but you need to be careful about the amount because any large transfer could trigger a control from HRMC. You should use tax optimization with dividends from parent company to subsidiary , you will only pay 5% of taxes if you transfer dividends from parent to subsidiary so it's a better choice to avoid HRMC
     
  13. negon

    negon Offshore Agent Mentor Group Business Angel

    You may simply setup a fake company for your business and from there route the money around. Look at UK where it is pretty easy to do such.