Us Llc non resident

[Obelix]

Im thinking in open a Us Llc non resident, what i understood is that as non phisical business in us, no usa customers,etc Us Llc have not to pay taxes in US

As is a pass through i have to pay taxes where i have my residence

I live in Cyprus, i asked my accounter about who have to be the shareholder or the Us Llc, me or my Cyprus Ltd, he told me better the Cyprus Ltd, so will receive the dividends from Us Llc and usa will only witholding 5%, if i do as personal will be 15%, and then in Cyprus in both cases only will pay 2.65%

Anyone can tell me if this its correct?

I read in many places that is same way if sharehoder is a person or a company in the Us Llc, but right now im so confuse, and in one website they told me if the shareholder of the Us Llc is another company its taxable in Us, anyone know about this?

Thank you for your help

 

[TRGali]

I don't know much about the details of the US LLC.

I am no expert about them, so I won't say much. Just check that EU reverse hybrid rules won't make your Cyprus company liable for paying Cyprus CIT 12.5% on the profit of the US LLC on the basis that it is a tax transparent entity.

 

[churumbelo]

I wonder whether the Cyprus tax agency considers a US LLC as a transparent or an opaque entity. And in that specific case, they might not see it as if your Cyprus company receives dividends. Also, on the US side, I do not know if a US LLC is considered as a pass-through entity by the IRS when it is own by another company.
Those are some questions I can quickly think of after reading your post. Luckilky someone else will answer to those.

 

[Obelix]

I don't know much about the details of the US LLC.

I am no expert about them, so I won't say much. Just check that EU reverse hybrid rules won't make your Cyprus company liable for paying Cyprus CIT 12.5% on the profit of the US LLC on the basis that it is a tax transparent entity.

Thank you its first i thought, now i talked my accounter in Cyprus, said no 12,5% if come as dividends

I wonder whether the Cyprus tax agency considers a US LLC as a transparent or an opaque entity. And in that specific case, they might not see it as if your Cyprus company receives dividends. Also, on the US side, I do not know if a US LLC is considered as a pass-through entity by the IRS when it is own by another company.
Those are some questions I can quickly think of after reading your post. Luckilky someone else will answer to those.

Every place i read not different if sharehoder is Cyprus Ltd or personal, but one said its different, its why im asking to confirm

 

[CyprusLaw]

Thank you its first i thought, now i talked my accounter in Cyprus, said no 12,5% if come as dividends


Every place i read not different if sharehoder is Cyprus Ltd or personal, but one said its different, its why im asking to confirm

We addressed this issue in the passed - the US LLC would be considered a transparent entity and therefore if you are the shareholder then the tax dept would see it as income and not as dividends. Therefore it is advisable that you have the Cyprus entity as the shareholder and then receive it as dividend.

 

[Jerry1911]

We addressed this issue in the passed - the US LLC would be considered a transparent entity and therefore if you are the shareholder then the tax dept would see it as income and not as dividends. Therefore it is advisable that you have the Cyprus entity as the shareholder and then receive it as dividend.

Would it be the same for other jurisdictions as well? e.g. Belize LLCs, SVG LLCs, etc.?

Out of curiosity, would it be possible to make such entity a corporate tax resident of Cyprus? Not sure if it would fulfil TD 98 form requirements as it mentions corporate seal, shareholders’ meetings, etc.

 

[Obelix]

We addressed this issue in the passed - the US LLC would be considered a transparent entity and therefore if you are the shareholder then the tax dept would see it as income and not as dividends. Therefore it is advisable that you have the Cyprus entity as the shareholder and then receive it as dividend.

Thank you very much for your help, theres people saying even in personal you can decide go to dividends, but i understand as you its a pass through, is why my Cyprus LTD will be the shareholder of the Us Llc, so will receive as dividends, and if im right Usa will withhold 5% of dividends

 

[Jerry1911]

Thank you very much for your help, theres people saying even in personal you can decide go to dividends, but i understand as you its a pass through, is why my Cyprus LTD will be the shareholder of the Us Llc, so will receive as dividends, and if im right Usa will withhold 5% of dividends

Watch out for the branch profits tax in the US

 

[Obelix]

Watch out for the branch profits tax in the US

Ask different companies, they said i have to pay in Cyprus, where shareholder have his residence, in this case the Cyprus LTD, not pay tax profits in US as is an US LLC non resident, will not have shop there, will not have us customers, etc

 

[TRGali]

Thank you very much for your help, theres people saying even in personal you can decide go to dividends, but i understand as you its a pass through, is why my Cyprus LTD will be the shareholder of the Us Llc, so will receive as dividends, and if im right Usa will withhold 5% of dividends

But in that case, the same issue you would face as a CY resident individual, your CY company will face. And your CY company will have to pay 12.5 % tax on this income that will not be seen as dividend (same principle as for an individual). Or reverse hybrid rules might be used against your company. You might be able to get away with it, I actually don't know, but if they look into you then that's when the real problems would start.

 

[Obelix]

But in that case, the same issue you would face as a CY resident individual, your CY company will face. And your CY company will have to pay 12.5 % tax on this income that will not be seen as dividend (same principle as for an individual). Or reverse hybrid rules might be used against your company. You might be able to get away with it, I actually don't know, but if they look into you then that's when the real problems would start.

Perphas and thank you, but i asked Cyprus adviser and Us and told me Cyprus Ltd as shareholder of the Us Llc and sent profits as dividends, ill try, thinking the worst will be the 12,5%, but the opinion of most most people its dividends can be send

 

[CoinMaster]

Perphas and thank you, but i asked Cyprus adviser and Us and told me Cyprus Ltd as shareholder of the Us Llc and sent profits as dividends, ill try, thinking the worst will be the 12,5%, but the opinion of most most people its dividends can be send

did you get setup this way ?

 

[Obelix]

did you get setup this way ?

I opened the us llc non resident, and shareholder is the cyprus ltd, but didnt work yet, and anyway the problem about profits, will be next week
After so much reading and hear people, looks that the true profits from us have to go to the ltd direct and have to pay in Cyprus 12,5%, but most people i talked, send to cyprus and declare there as dividends that receive.
But what i understand is that is not the correct way