Corporate business structure 2019

    A distinctive feature of modern technology is the incredible speed of change. And this is not surprising, if you want to be the best in something - you have to constantly develop. For once, such a tendency is observed in the sector of state regulation. Unbelievable, but it is a fact! Over the past 2 years, legal business structuring has changed beyond recognition.

    Today, the world of corporate structuring is confidently moving towards a model of paying taxes in a country of vital interests. What does it mean? In simple terms, your tax residency, company, office and bank account should match.

    And while lawyers and bizdews are racking their brains, and banks are demanding almost fluorography (they have been asking for certificates from the Housing Office for a long time), we will try to figure out solutions that still work today. Also, I want to note that there is no single universal solution for everyone, everything is very individual ...

    DISCLAIMER : I am NOT a representative of a law firm and do not provide services for registering or opening bank accounts. All the facts stated in this article are my personal experience that I got while doing business.

    And so, the main trends in registering a business - classic offshore and partnerships are extinct. They are not here. Just humble yourself ...So now they speak at numerous seminars, conferences and trainings. They can be understood. Opening an account is now very difficult even for a taxable company, not to mention offshore. Operating expenses for opening offshore can easily be exceeded / exceeded for $ 20,000 and guarantees will be only 50% for success. But there is an alternative, risky (as, indeed, always), but there is. About it a little lower ...

    Today, a company in the EU has become just a must have for business. Such a company opens quite easily, is relatively inexpensive, and it is easier to open an account. However, when you first submit financial statements, you will understand that it is not so simple, and it costs an order of magnitude more than you originally planned ...

    Everything is simple: if your clients are individuals - become a member of BAT and pay tax; you sell your application (game, service) in the EU - become a BAT and pay tax; your customers - companies in the EU - join BAT and pay tax. You work with companies outside the EU - forget about dollars, and therefore pay for conversion.
    Quoting Benjamin Franklin: “ Only death and taxes are inevitable in this world
    Believe me, and do not listen to registrars and other tax consultants - in the EU you will be forced to pay tax, whether you want it or not. Aggressive tax optimization is also not the best option. Tax authorities are no longer fools and do not think that you are smarter or more cunning than them. They will immediately calculate you, but with the new rules, when only 2,000 euros can be written off as expenses for importing services to the EU, and the tax should be deducted from the remaining amount (average size 20%). Work through these jurisdictions becomes real gold. Although, if you are so fond of the country in which you have a company that you are ready to raise their budget, then this is your option.

    Based on the current situation, the business has very few alternatives, namely:
    Georgia, Hong Kong, UAE, Singapore and the USA. But be prepared - opening accounts in the EU in 2019 on them is almost impossible. Therefore, you need to look at local banks.
    In Georgia, you need to prove that you really do business and show the center of vital interests in Georgia. Such a company will cost you an average of 3-5 thousand US dollars.

    Local accounts in Hong Kong and Singapore - will make you immediately taxable, and you will lose all the delights of territorial taxation. Do not believe those who say the opposite. There are an incredible number of precedents when the tax only because of the local bank account deprived the company of offshore status and accrued taxes on the entire turnover. And yes, you must understand that each auditor and tax will make a decision in favor of the state, not business, especially in matters of replenishment of the treasury.

    UAE - a classic offshore - works with US dollars and euros. Half of the activity in the emirates is prohibited and can sometimes be punished by death (casino, dating, crypt, etc.). Weigh all the risks and only then decide.

    Singapore, Hong Kong and the UAE will fly you a pretty penny - from $ 10,000 just for registering a company. Additionally, you will have to pay a minimum office, account opening services. As a result, the final price will upset you very much.

    Well, for dessert, like a cherry on a cake - USA. It's very simple, choose any state except Delaware, which is notorious, and in many countries this state is on the black list. Do not forget to create a virtual presence in the USA and show real offices. Most likely to open an account with banks such as Bank of America, Wells Fargo and Chase. The remaining banks are in question.

    Not a little important fact, recently there have been frequent cases when company owners were deprived of B1 \ B2 visas and were obliged to make a working visa already, only on the basis that they have a company and they will start a business.

    The rapidly growing business challenges the traditional banking system and government agencies. Over the past couple of years, many alternatives to classical banking institutions have appeared on the market, for example, electronic payment systems. Business more and more often uses accounts in payment systems to carry out operational activities. BUT this is a temporary and very unsafe solution.

    In the case of SCAMa, you will not receive money, not even parts. Also, starting in 2019 - payments began to experience more and more problems with correspondent banks, and because of this, they began to monitor the activities of the company and the payments themselves more closely. In case you do not have a package of documents for payment - this is a fiasco. If the prices for services are too high, this is a failure. If you cannot confirm the reality of the services provided, this is a disaster.
    Such tools should be used only as a wallet, to receive money from counterparties and immediately send them to a reliable bank.

    The pluses are that they will accept a “dirty” business (dating, casino, crypto) for service, as well as an offshore company.

    Diversify your risks and keep in mind the “B” plan, you should have a quick option to withdraw money to a safe place.

    And what is the bottom line?

    1. The amount of operating expenses will be high;
    2. Amounts for registration of companies and accounts from $ 10,000 is the norm;
    3. You must understand the RISKS that you assume;
    4. Money in payments - they won’t return you!
    5. When creating a structure, immediately calculate the worst case scenario - tax losses when dividends are withdrawn (if it is interesting, I will write a separate article).

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