U.S LLC OR UK LTD?

I can't accept any payments in PAYPAL since it's not supported on my 3rd world country.
Shopify payments also doesnt work on it let alone STRIPE. one payment method would be 2 checkout. WISE DOESNT WORK ALSO.

I have some questions. Which one is better in terms of taxes and what taxes do you have to pay sale taxes, federal taxes and how much are they?
Do you need also to pay home taxes (your countrys taxes).
Another question is regarding WISE. If you have a wise account can people hold the money there and not pay any home country taxes?

@splishsplash an answer from you a detailed one would be highly appreciated.

Thank you guys

Nonused said:

I can't accept any payments in PAYPAL since it's not supported on my 3rd world country.
Shopify payments also doesnt work on it let alone STRIPE. one payment method would be 2 checkout. WISE DOESNT WORK ALSO.

I have some questions. Which one is better in terms of taxes and what taxes do you have to pay sale taxes, federal taxes and how much are they?
Do you need also to pay home taxes (your countrys taxes).
Another question is regarding WISE. If you have a wise account can people hold the money there and not pay any home country taxes?

@splishsplash an answer from you a detailed one would be highly appreciated.

Thank you guys

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Too many complicated questions about taxes, but I'll give you the simple answers.

LLC is a pass-through entity and disregarded for tax purposes as long as it doesn't fall into ETBUS(google it, but you wont unless you have offices/staff in the US generally), which means if a Spanish company owns a US LLC, then all earnings of the LLC are essentially that of the Spanish company.

If a person tax resident in Spain owns it, then it's going to be treated as either a Spanish company, or you'll just pay self-employed taxes as if you were a self-employed person living and working in Spain.

Sales tax is not federal. It's state. I'm not 100% sure on all the sales tax laws, but it's not something that we ever seem to pay. Sometimes I get it added on some sites depending on what address I use. I don't charge it, and I know I'm not required to charge it. When it SHOULD be charged for a US company, I don't know. I think it's maybe if you're IN a state doing business. It's not an important one because as a disregarded entity you won't charge it to anyone.

For an LLC there's only a few forms you need to fill out. You don't pay any US taxes. (As long as you don't fall under ETBUS of course)

Asking if wise can be used for tax evasion.. We are on a public forum, so I wouldn't ask people how to evade tax in a public forum.

Pay the taxes that are due and use the legitimate corporate structures to minimize your tax liability.

What wise discloses is complicated, not entirely known, dependant on your country and subject to change at any time.

The best plan is to hire a good accountant in your local tax jursidiction and seek advice on minimizing your tax liability. Professionals exist for a reason, and they can help you

Following, Just wanted to post the same question... In my case , I don't have any personal tax in my country, all I want is pay less for Company and don't pay tax, then get the Bank accounts, and if I go travel to that country, don't get arrested

splishsplash said:

Too many complicated questions about taxes, but I'll give you the simple answers.

Click to expand...

Pretty good so far!

splishsplash said:

LLC is a pass-through entity and disregarded for tax purposes as long as it doesn't fall into ETBUS(google it, but you wont unless you have offices/staff in the US generally),

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"ETBUS" could potentially also be activated (especially in the future) if you're using cloud services located inside the US. Or if you are using a "dependent" warehouse for your products inside the US. Courts probably won't consider it like that but it's Common Law and you never know what you get if it comes to a legal proceeding. Also, not to forget Sales Tax which is probably triggered earlier, ie. regardless if it's a "dependent/independent" warehouse, but would not be Federal, just for the state your warehouse is in.

And not to forget the virtual US bank accounts. All those US bank accounts / EMIs that you can open remotely for foreigner-LLCs ask specific questions where you basically have to lie to get onboarded. And this lie is that you will be "ETBUS" / doing business inside the US. This could be used by the IRS against you at some point later.

splishsplash said:

which means if a Spanish company owns a US LLC, then all earnings of the LLC are essentially that of the Spanish company.
If a person tax resident in Spain owns it, then it's going to be treated as either a Spanish company, or you'll just pay self-employed taxes as if you were a self-employed person living and working in Spain.

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Some countries have loop holes and don't consider a pass through US LLC as a local entity.

And generally, the UK allows the same "pass through" for its LTDs but on request only. So, you would have to file for it and get the request granted. Or go with a UK LLP which is also a pass through entity, however it's overall worse than an US pass through LLC.

@Nonused UK opens more options but is more stricter with everything. Just do both - that's what I do. And then add Canada pass through LLP and some more companies and then you can just sell to US customers with your non-US company and to non-US customers with your US company

Ahmirof said:

have any personal tax in my country

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In that case, US LLC is the best choice to start.

At higher volumes, try partnerships in other countries and learn about PE (Permanent Establishment)