Hi everyone,
I am planning to start a business with my friend. We will set up a US LLC single member because it is better in terms of taxes. We already confirmed that our business would not pay any taxes in US because there would not be US sourced income.
If my friend who is Serbian resident (but he is traveling a lot on a vessel during the year, in most times not reaching 183+ days in Serbia) become a single owner member of US LLC, what happens if I am doing the business from my computer from Serbia as an individual (not an employee of his company, basically no ones knows that I am connected with his US company) and at the same time while I make a profit, he is located in for example Portugal or China or India etc ?
What is happening with that foreign source income , what will they count for where are the services performed ? Will it be Serbia, maybe per my IP address (even if I am not his employee or nothing) ? Or will it be maybe Portugal or some other country, based on that at the moment of making profit, he, as a owner of LLC and the only person connected with LLC, was located in Portugal for example (and many other countries later) ? Can Portugal and other countries tax him because "services were performed" in their country ?
Does this makes any sense? Or we are not taxed anywhere until we transfer money to some country ( it will only be to Serbia ) ? So we would never transfer any money to those countries where he is traveling on a ship. Should we set up a Serbian company with me as an owner from the beggining, so my company will invoice his company and we can avoid all of this (if it is true) ?
Looks complicated to me, hopefully this is not the case, and if he is a tax resident in Serbia, he can perform the work from around the whole globe (except US ofc) and he will be taxed ONLY WHEN transfers money to Serbia (taxed then per Serbia laws)
Thanks in advance for the answers.
I am planning to start a business with my friend. We will set up a US LLC single member because it is better in terms of taxes. We already confirmed that our business would not pay any taxes in US because there would not be US sourced income.
If my friend who is Serbian resident (but he is traveling a lot on a vessel during the year, in most times not reaching 183+ days in Serbia) become a single owner member of US LLC, what happens if I am doing the business from my computer from Serbia as an individual (not an employee of his company, basically no ones knows that I am connected with his US company) and at the same time while I make a profit, he is located in for example Portugal or China or India etc ?
What is happening with that foreign source income , what will they count for where are the services performed ? Will it be Serbia, maybe per my IP address (even if I am not his employee or nothing) ? Or will it be maybe Portugal or some other country, based on that at the moment of making profit, he, as a owner of LLC and the only person connected with LLC, was located in Portugal for example (and many other countries later) ? Can Portugal and other countries tax him because "services were performed" in their country ?
Does this makes any sense? Or we are not taxed anywhere until we transfer money to some country ( it will only be to Serbia ) ? So we would never transfer any money to those countries where he is traveling on a ship. Should we set up a Serbian company with me as an owner from the beggining, so my company will invoice his company and we can avoid all of this (if it is true) ?
Looks complicated to me, hopefully this is not the case, and if he is a tax resident in Serbia, he can perform the work from around the whole globe (except US ofc) and he will be taxed ONLY WHEN transfers money to Serbia (taxed then per Serbia laws)
Thanks in advance for the answers.
