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Legal Structures for your Business that pay no tax - Legally

Discussion in 'Business & Tax Advice' started by canweoffshoreit, Nov 5, 2014.

  1. canweoffshoreit

    canweoffshoreit Newbie

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    I'm setting up a business and I want to do it right from a legal point of view. I live in a high tax country and at some point intend to become a citizen of the world. I have an idea for a legal structure and was wondering if anyone else was thinking the same thing. My objective is to have a truly international company. I will lay out the details now and go into specifics if anyone if interested:

    MANAGEMENT STRUCTURE


    • Company incorporated, business registered in an offshore location.
    • Offshore corporate trustee for the benefit of Unit/Discretionary Trust with beneficiaries in 3+ different countries .
    • Management Decentralized and shared with Directors domiciled in 3+ different countries.
    • Items to be posted out of China (for example)
    The Experiment
    What if we could create a new system of management and ownership? Where the role of the CEO was decentralized and instead was a democracy of the directors.
    Each director was responsible for a specialist area (or areas):

    • Marketing and content production
    • Finance, Banking and Accounting
    • Web development
    • Service Outsourcing Management
    • Product Sourcing and Supplier Management
    • Product design
    • Facilitator / Director intermediary
    What if we could get experts in each field and make them in charge of their defined areas as directors. They would have clear objectives and targets given by the board. The board would have mechanisms to reward genius and punish mediocrity. Would the voting machine work if at all?
    Would they perform better in such a competitive environment?
    Could the Board put aside their conflicts of interests and work for the greater good, and ultimately be better off?
    As these people would live and work from all over the globe, what would the company?s legal and tax domicile be?

    LEGAL QUESTIONS

    Where does the sale take place in following circumstances:

    • Client stumbles across site using google for example
    • Client directed by Australian targeted advertising.
    • Social Media
    • Client directed by friend.
    • Client directed by person in Australia/US who receives a ?Loyalty Bonus?.
    • Transaction is facilitated by Resident who creates a recommendation. Client reviews order and provides payment details and tick ?I agree box? which has good wording.
    Does the place of the transaction depend on:

    • The Domicile of those who Effectively Control and Manage the business.
    • Domicile of the Shareholder(S)
    If there were many Directors/Shareholders what is the maximum percentage that could come from one country? Would it be 51%.

    • Where it was shipped from.
    • Location of Server
    • Bank Location

    What is the treatment of Sales Tax? ANSWER: Where it is sent from (Goods) Where it is created (Services).
    If there were salespeople and commissioned representatives (agents), Would the sale take place in their country of domicile? Does this open the door to the rest of the company?
    Does it need a local option to: a) pay sales tax
    b) operate at break even via pass through country (no tax on foreign income regime) .
    Alternatively, would a discount, loyal points some other incentive scheme constitute agency
     
  2. kypso

    kypso Junior Member

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    For this kind of complex questions I would advise you to consult with an accountant or lawyer specialized in this kind of area. You will get so many different answers here that you are maybe losing the oversight.

    K.
     
  3. RuthSam

    RuthSam Jr. VIP Jr. VIP Premium Member

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    You need a good Tax lawyer and not BHW!! It all depends on your countries law's and tax regulations which is different from country to country.
     
  4. IMOutlaw

    IMOutlaw Newbie

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    This is a touchy subject - Every Country has very different laws/regulations. If you have a friend or acquaintance who is an Attorney I would ask them. If not, consult a tax Attorney.
     
  5. yesww

    yesww Newbie

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    Tax optimization makes sense when the money you're going to spend will be less than what you will save. If you don't have earnings to justify all the expenses of having to pay to different governments its pointless. When you have enough earnings you will be able to pay an expert to help you optimize the tax bill.
     
  6. canweoffshoreit

    canweoffshoreit Newbie

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    If Google doesnt have to pay it's dues, why should we?

    Does anyone think the management system would work? Where can you find other like minded entrepreneurs?

    I was thinking about a system that by it's very nature, transcends these international laws and could work as a template. Can a business be truly international if management and shareholders are scattered. Where tax is only paid as foreign income when you receive a dividend/salary. Where you can relocate to a tax friendly country when it comes time to cash in your chips.

    Isn't it smarter to set up a tax effective system before you start a business?

    Of course you need highly specialised advice based on you country of domicile (you neighborhood lawyer wouldn't have a clue). I will let you know what they tell me...
     
  7. heymalc

    heymalc Newbie

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    Hi - what country are you in? I've got a guy in the UK who would advise you on that stuff. He's my own tax accountant.

    I advise finding someone who is not too "aggressive" - in other words not on the edge. Because these are the schemes targeted by the tax man and governments. Therefore they don't tend to last long - and any change in the law might be retrospective.

    It's better to be sensible in tax minimisation (which still puts you ahead of 99% of taxpayers) and sleep at night.

    Certainly, a lot of the answer will be: do you mind being resident in a tax haven? In the UK, that means not returning for more than so many days a year. These criteria change, but I think it's either 3 or 6 months a year.

    Good luck!

    Malc
     
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  8. Asif WILSON Khan

    Asif WILSON Khan Executive VIP Premium Member

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    OP, consult both a Lawyer and Accountant that specialise in this area.
    Also look at the PT(Perpetual Traveller) books by W G Hill, the books are out of print and the information is dated but they will get you thinking.
     
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  9. varkom

    varkom Newbie

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    if you have the cash, consult lawyer/accountant...if you don't then don't worry about it. Do it the "bad" way first, then once you are ready you can always reorganize things
     
  10. Reyone

    Reyone Elite Member

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    Worry about making money before you worry about optimizing it.
     
  11. Ghoast

    Ghoast Power Member

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    For the 1 billionth time, don't ask for tax advice on BHW:

    1. Everyone here is from different countries
    2. 99% of users are NOT accountants or tax experts

    Becoming a perpetual traveller is a fun idea though, and why not... Most tax things come down to where YOU are and where your COMPANY is.. Unless you're an American Citizen in which case they will chase you around the world trying to tax you lmao
     
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  12. canweoffshoreit

    canweoffshoreit Newbie

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    Not necessarily true if you are a US citizen if you are smart about it. You may be able to avoid (not evade) some tax under the right circumstances and with the right legal structures in place. After all, how much tax does Apple and Google pay? Sweet F A
     
  13. aretepharma

    aretepharma Newbie

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    I can provide tax/legal advice using Malta as the jurisdiction of incorporation.

    skype:moosemalta