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[Theory] Tax evasion as an SEO firm

Discussion in 'Black Hat SEO' started by SlappinDaBees, Nov 26, 2012.

  1. SlappinDaBees

    SlappinDaBees Regular Member

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    Before you start burning me.. this ain't my idea nor an actual plan. I don't have 1% of the required knowledge to setup an SEO firm, get happy costumers or barely do proper SEO for my own sites. But I had a discussion with a friend of mine (he does have the skills to setup something like this) about whether it is possible to setup a bulletproof SEO firm that isn't subjected to income taxes. I personally don't believe it is possible and the risks and consequences when you get caught are way to high for somebody like me. But anyway this would be his setup:

    1. Create a dozen fully anonymous PayPal accounts with a vcc's (one for receiving money, others for funneling)
    2. Register a domain and hosting with a fake name and privacy protecting at an offshore "bulletproof" company - never heard of these anyway :s
    3. Setup a nice looking website (that one is easy to do :))
    4. Promote your biz online through forums, adwords and other forms of advertising (this is where the biggest problem is imo)
    5. Pursuade clients to pay through pay buttons on the website or through a invoice (to eliminate paper traces)
    6. Funnel the money through the anonymous PP accounts to 1 - 3 legit accounts to transfer to your bank accounts

    Personally I see a problem with 2. and 4.
    First off, I've never heard or seen a bulletproof hosting company. Tell me if they exist but i still believe that any company would give in under legal pressure and they would give out the name of the register. It would still be a fake name but if they somehow manage to crack that name your caught. Second, promoting can only done SAFELY through forums (which isn't really effective) and not with advertising as they also require a credit card and I heard a vcc doesn't work for this. And without clients the whole purpose would be gone

    Tell me what you think. Remember that this is all theoretically speaking but it would be fun to rub this in his face if he's wrong :D
     
    Last edited: Nov 26, 2012
  2. upl8t

    upl8t Regular Member

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    Tax Avoidance. Tax Evasion. Two totally different things. One is legal in most countries and one can send you to prison for a very long time. You're heading into very dangerous territory.
     
  3. SlappinDaBees

    SlappinDaBees Regular Member

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    No I'm not since I ain't planning on neither of the two :p It's just a discussion with a friend and I'd like to talk it out of his head with reason
     
  4. olystyle

    olystyle Regular Member

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    Hey SlappinDaBees

    Evading taxes never ever crossed my mind for as i live in Switzerland - companys have to pay here 13.8% taxes on of the lowest taxrates in europe...
    Ever tought of moving your buissness to switzerland? have a look a virtual offices... :)

    Well not paying taxes at all sure would be nice but what if you get caught? Jail for 1? 2? 3? or more years depending on where you live...

    Think about it in this way:
    - You set up your company in a state with low taxes - doesn't have to be switzerland maybe the cayman islands, singapure, isle of man or the like
    - But: Now thar your company has lower taxes than it would have in your/another country - doesn't automatically mean that the taxes wich you have to pay as a citycen of your city are lower as well...

    And here comes the trick:
    - Let your own company pay for as much as possible...
    - Your company pays your appartment, the food, transit, car,...
    - the goal is to pay yourself a salary wich is so low that you have to barely pay taxes for it...

    A little math:
    Let's assume your company got an actual income of 35'000$ Monthly thus 420'000$ Yearly and you live in the UK
    Your company would have to pay an average of 26% (please correct me if I'am wrong) taxes - 109'200$ taxes every year
    After moving your company to Switzerland you would have to pay 57960$
    With this simple action you'd save 51'240$ every year...

    Let's further assume that you pay yourself a salary of 15'000$ every month thus earning 180'000$ Yearly and you live in the UK
    With 180'000$ which is 112'410 Pounds you'd fall under the "higer taxrate" which is 40% (info taken from gov uk is this really true?!!)
    If you would pay everything: 72000$ taxes or 44963 Pounds in taxes. - Now thats a lot!

    Alright - your luxury appartement costs you 2500$ every Month the leasing for your car an addtional 800$ extra and not to forget gasoline worth 250$, insurances as high as 400$, and food for 700$ ----- intotal: 4650$
    Lets see we can safely say that in future your company is going to pay for your expenses... so lets cut your salary for 5000$ to 10000$ Monthly well how to further cut it? Lets see you need money for random stuff such as: books, magazines, coffee on the go, presents, whatsoever... in total 1000$ - guess what: Your company pays! You used to save up some money? leave the money in the company...
    most likely you could cut your salary in half (or even much lower) to 8500$ while still looking perfectly legit, no questions asked and legal... ok with 8500$ monthly you'd earn 102'000$ amounting to 40'800$ taxes
    A saving of 31'200$.

    As you can see - setting up your company in a state with low taxes can be highly beneficial...

    Cheers

    olystyle
     
  5. DamageX

    DamageX Elite Member

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    Just tell him to say hi to Bubba for you, when he becomes his bitch. Works most of the time.
     
  6. ja1myn

    ja1myn Senior Member

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    The IRS has access to bank accounts and they can see where the money came from and from what PayPal accounts specifically.
     
  7. Smeems

    Smeems Regular Member

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    The fact that your "friend" is willing to place so much of the fate of the operation in PayPal's hands is almost as ludicrous as this idea in the first place.

    Any other advice I just won't give. Tell your friend to pay his fucking taxes.
     
  8. SlappinDaBees

    SlappinDaBees Regular Member

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    Thank you for taking the time to write all this down! But it wasn't really neccessary since I'm a self-employed central heating engineer with an annual turnover of €200.000 :p I was fortunate enough to have an accountant for a brother and he's pretty good at it. The things you described are indeed the way it's done. The company pays :p
    For my OP; this is all theoretically speaking as this isn't possible when you're providing an actual touchable service like I do. Taxes are, however, a touchy subject for many business owners. I live in Belgium. An average person here makes between €1500 - €2000 a month but a single unemployed person gets €1100, no questions asked :s
    It's WORKING people like you and me that pays that €1100. Can you see where the frustration and questions are coming from? :) BTW Belgians have a reputation for being the best tax evaders xD

    LOL xD Gonna try that
     
  9. SlappinDaBees

    SlappinDaBees Regular Member

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    Couldn't agree with you more but may i ask.. where are you from?
     
  10. alterbuu

    alterbuu Junior Member

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    The best way to launder money or avoid taxes I have seen lately is to setup a superpac and a 501-c4. For more info see Colbert super pac
     
  11. Smeems

    Smeems Regular Member

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    UK, so I know a thing or two about welfare and tax avoidance. Also:

    Greece called. Bitch please.
     
  12. Expertpeon

    Expertpeon Elite Member

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    Your suggestion with paypal can and will send you to jail... there are ways to avoid taxes in the UK, but paypal VCCs and BS will get you into EU reporting trouble fast.

    Not only is it bank fraud, but it's tax evasion. Paypal is a bank in the EU
     
    Last edited: Nov 26, 2012
  13. the_demon

    the_demon Jr. Executive VIP

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    *** I do not encourage, promote, or suggest doing money laundering / tax evasion. You'll get caught eventually and go to jail. ***


    It's relatively easy to launder money, getting it out of the system is always the tough part. In theory you need a bank at some point to pull the cash out. In the US, the second that money hits a bank account your caught. There are very few methods of extracting cash without a bank that are also untraceable and that are in a usable cash form.

    To run an operation of any kind of scale you'd likely need to pay of bankers in foreign countries and even doing that is highly risky cause if you ever stop paying them their cut or they just get greedy and take all your money and it can and will be gone within minutes.

    All in all, focus on making more money then you won't have to worry about this kinda nonsense. It just leads down a dangerous path.
     
  14. Gyuman82

    Gyuman82 Jr. VIP Jr. VIP Premium Member

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    Just learn all the legal loopholes and you'll be fine. Buy a book on individual taxation and you'll probably find more than enough places to save on taxes.
     
  15. jstover77

    jstover77 Executive VIP Jr. VIP Premium Member

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    Get a good accountant and make more money. Nothing is worse than looking over your shoulder all the time.
     
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  16. Crewchief007

    Crewchief007 Power Member

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    Tell your friend that there is a tax specialty called, "Forensic Accounting"

    The men and women who are designated as "Forensic Accountants" take great pride in uncovering putz's like your friend.

    If your friend comes under the jurisdiction of the IRS, advise him that they will spend $200 million dollars + in taxpayers money to collect $100.00 dollars in delinquent taxes.

    His best option is to find a great accountant and take advantage of all of the legal deductions.
     
  17. TheLinkGuy

    TheLinkGuy Power Member

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    Maybe I'm missing something, but how exactly do you evade taxes with this method? Paypal still needs to transfer to your bank account which is where the problem exists.
     
  18. gianni

    gianni Junior Member

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    Bulletproof host to hide privacy? Why do you need one?

    You're using tons of fake accounts to collect money from in the first place. Just use those.

    Making fake ID in photoshop isn't difficult. Using made up credentials when registering a domain is child's play.
     
  19. christianbed

    christianbed Jr. VIP Jr. VIP Premium Member

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    Yes, this exactly...a good accountant will more than pay for themselves.