US single member foreign owned LLC, can you accumulate the profit in the company account?

[Alexmorgan]

Well, I don't know about the other gulf countries, but with the new UAE corp tax rules, if you live in the UAE and manage a foreign company from the UAE, it is taxed just like a local company.

So you can take a salary from it tax free, but the salary has to be reasonable market level. Then you pay 9% tax on profits above 375k AED.

If the company is based or located inside UAE right?

 

[Cloudbanck]

If the company is based or located inside UAE right?

I mean if you own a single member US LLC and live in the UAE and have not set up substance anywhere else.

 

[Alexmorgan]

I mean if you own a single member US LLC and live in the UAE and have not set up substance anywhere else.

Wow

If UAE did this that means the rest of Gulf will do it for sure its matter of time

 

[andrew28fl]

Hi folks,

I am looking into pass-through single member US LLC. There are tons of info on this platform about it, but I don't see anything mentioned about profit accumulation.
Can the LLC accumulate the profit, or does it have to be passed to the owner 100% at the end of the year? Or is there an alternative way to accumulate the profit without paying hefty corporate taxes?

Asking this because currently I do not need the money and would like to keep in the company.

I came across this article, and thought it might be helpful to others.

How the LLC Pass-Through Taxation Works | SmartAsset

This is the case no matter how you distribute the LLC’s money at the end of each year. This means that even if you leave the company’s money in its own bank accounts, the individual members have to report those profits on their personal income taxes.

 

[seeker]

How do US IRS or US banks know if the LLC owner pays income tax or not in his home country?

 

[Alexmorgan]

How do US IRS or US banks know if the LLC owner pays income tax or not in his home country?

They dont care its not their interest

 

[andrew28fl]

How do US IRS or US banks know if the LLC owner pays income tax or not in his home country?

Read up more about CRS - What is the CRS? The Common Reporting Standard (CRS) is a new information-gathering and reporting requirement for financial institutions in participating countries/jurisdictions, to help fight against tax evasion and protect the integrity of tax systems.

 

[marioIT]

CRS is not the matter. USA is not part of it. They have FATCA. But that's not important.
They ultimately don't care if you pay or not taxes somewhere else. But you can be sure they will care you pay your US taxes, if due.
But they can and will answer to request of information from foreign countries, and they will share what they have when it'll happen.
"The United States does not tolerate offshore tax evasion, nor does it sanction tax evasion committed through U.S. financial institutions".
I know it sounds as a joke by just looking at the state of things there... but that's how they answer foreign john doe summons...
Now they have the beneficial owner registry, so they have the data and it'll be stored for years.
So your home country could ask about it even 3-5 years from now(or even more depending on country), during another investigation not relevant to you, and they'll potentially share it all.

Beneficial Ownership Information Reporting | FinCEN.gov

www.fincen.gov

• Under the proposed rule, foreign requesters would be required to make their requests for BOI through intermediary Federal agencies. In addition to meeting other criteria, requests from foreign requesters would have to be made either (1) under an international treaty, agreement, or convention or (2) via a request made by law enforcement, judicial, or prosecutorial authorities in a trusted foreign country. Requests made under international treaties or other agreements would be subject to different requirements and procedures than requests made in situations when no such agreements apply. FinCEN would look to U.S. interests and priorities in consultation with other relevant U.S. government agencies when determining whether to disclose BOI to foreign requesters when no treaty or other agreement applies. In neither case would foreign requesters have direct access to the beneficial ownership IT system. They would instead rely on the intermediary Federal agencies through which they route their requests to retrieve and furnish them with requested BOI.

Treasury granting access to BOI by Foreign Requester Authorized Recipients
The foreign request for BOI must be on behalf of:

a law enforcement agency, or
prosecutor, or
judge of another country, or
behalf of a foreign central authority or foreign competent authority, and:

(1) Come to FinCEN through an intermediary Federal Agency;
(2) Be for assistance in a law enforcement investigation or prosecution, or a national security or intelligence activity, authorized under the laws of the foreign country; and
(3) Either be made under an international treaty, agreement, or convention, or
(4) When no such instrument is available, be an official request by a law enforcement, judicial, or prosecutorial authority of a trusted foreign country.

Norway, Netherlands, and Finland already exploited the bilateral treaties to do john doe summons in past based on US issued credit/debit card used by its citizens.

In future with this new BOI framework it will be easier and more streamlined I think, and it'll be used against foreign owned entities.

The USA considers safe exchanging info with these countries:
Australia, Azerbaijan, Belgium, Brazil, Canada, Colombia, Croatia, Czech Republic, Denmark, Estonia, Finland, France, Germany, Gibraltar, Greece, Guernsey, Hungary, Iceland, India, Ireland, Isle of Man, Israel, Italy, Jamaica, Jersey, Korea, Republic of, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Mauritius, Mexico, Netherlands, New Zealand, Norway, Panama, Poland, Portugal, Saint Lucia, Slovak Republic, Slovenia, South Africa, Spain, Sweden, United Kingdom.
But as you read in the quotes above, they will share the data even if there's no treaty, agreement or convention if the requesting foreign country is deemed trusted.

So don't rely on Dementia Joe... US entities are not safe anymore if you're still living in high tax countries and managing them from your bedroom...

DYOR IANAL YMMV etc.