Registering a company?

[joemc]

Hi
Let's just say for a second thar I was making a considerable amount of money. Now I'm thinking about taxes on this.
In my country for individuals, there's a standard rate of tax (we'll just say 20%) up to a certain cut off point. (we'll say 30k). There's then a much higher rate off tax payable on any amount beyond this cut off point. (say 40% just so we have figures)

However taxes on corporation's income seems to be only 25%.

If I was making above the cut off point for individuals, annually, is there anything wrong (legally/etc) with registering a company (before the start of the year) and having all money/income connected to the business/company, paying all taxes and such?

Will this all be fine or am I missing anything? (basically registering my own company, getting income, and paying all taxes required by law)
thanks,
Joe
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[Cookiehunter]

Will this all be fine or am I missing anything? (basically registering my own company, getting income, and paying all taxes required by law)
thanks, Joe
Posted via Mobile Device

Joe, you ask for legal advice, without revealing which country you're talking about...?

I'm in UK here, the "mother" of Register-a-company-for-saving-taxes.

 

[neuromancerx]

google seychelles IBC or belize IBC
usually comes with latvian or cyprus bank account. total cost around $900-2k depending on what offshore company you go with.

only withdraw your funds from your corporate bank accounts with a totally anonymous reloadable ATM card (NOT the cyprus/latvian atm card) so nobody can see the money trail. obviously never report you have an offshore company (your registrar will conceal your name). profit

or do it the legal way and just register the tax exempt seychelles corp and get a pro accountant to do your taxes.

 

[fearos]

You must be from the UK as 30k's the first wage cap. Just get limited and just write everything off as 'company expenses'. Suits, lunches, PCs you name it, you can claim it back. Not to mention when you open a business bank account get to know you business manager well he/she/it will introduce to a shit load of clients. You can turn around a limited company in a couple of hours online in less than 3 hours.

 

[theconfidenceman]

all the comments from above are right on. I especially like the IBC. Very solid way to do it.

Thing is, with corporations, you would still have to claim a piece of what you are living on as income to you. So in effect you are paying a corp tax + an individual income tax.

The corp can put all your expenses and salary on the books and show no profit, while you take a very low salary. This is legal and common.

 

[drdoc]

KEEP IT SIMPLE,
you can of course set up a corporation and be an employee of that corporation. Your employee income is taxed in your home country (as long as you do not work in the US). The corporate income is taxed in the place of incorporation.

So easy.

 

[Massive]

all the comments from above are right on. I especially like the IBC. Very solid way to do it.

Thing is, with corporations, you would still have to claim a piece of what you are living on as income to you. So in effect you are paying a corp tax + an individual income tax.

The corp can put all your expenses and salary on the books and show no profit, while you take a very low salary. This is legal and common.

You only pay corp tax on profits, salaries are part of the costs associated with running the business, and are not taxed twice.

In other words, claim anything and everything you can as a business expense, and then only take out what you really need in cash as salary.

Example:

Massive BlackHatWorld ltd.
Turnover 200K
Expenses 160K <- Your suits, lunches, cars, etc
Salaries 29K <- Your salary
---------------
Profit: 11K

You pay income tax on the 29K, company pays corp tax on the 11K

Its all accounting, and the real trick is to make sure the expenses are all accepted as relevant to the company.