HK company + residency in territorial or no tax country.

[batak]

Hi,

Can someone help we clarify if I am correct here?

Let's say that you operate an offshore business with an HK or BVI company (therefore not taxable) and you reside (and receive your salary in Panama (for instance) or Dubai.
Does that means that you pay zero corporate taxes and zero incomes taxes?

Then let's say that you spend over 184 days in Dubai (when weather is perfect) or Panama and the rest of the time in Europe to visit friends and family (but your close family does reside with you and not in EU).
Will it change your tax situation?

Thanks

 

[Martin Everson]

No.

No.

 

[batak]

Thank you
To make sure I understand you correctly : Is it "no your assumption‌ is not correct" (no, you would pay taxes) or "no, you would not pay taxes"‍ ?

 

[Error404]

Hi Barak,

Hope you are doing well,

Let me explain you in︀ HK there is NO CORPORATE TAX they have Profit Tax, Property Tax and Salary Tax︁ and the annual tax go from 12 to 18 months.

The profit tax is 8,5%︂ for < 260k profit and 16,5% >260k profit, but in the meantime if your HK︃ company is a vehicle to reduce your tax burden and you will not do business︄ in HK but all outside the country you are allowed to request after 1 year︅ the OFFSHORE STATUS.

If you reside in Panama or Dubai you are right you do︆ not pay taxes on your income.

Regarding your last question first of all I highly︇ recommend to consult a business consulting company like us cause you need to check the︈ double taxation treatment from your tax residency country to the country of your Family (close︉ if we mean your wife and your children)

if you mean your parents will not︊ change your tax situation.

Hope I answered all your questions

 

[Martin Everson]

Its "no your assumption is not correct".

Economic Substance⁠ alongside place of effective control and management is what you have not considered. Just think⁤ through your plan again with these in mind and see if you come up with⁣ same result 😉.

 

[batak]

Thank you very︅ much for your clear reply.
As you mentionned to consult with a business consulting company︆ like yours, can you tell me more? Is your company specialized in offshore taxation?

 

[JimBeam]

Why complicate things with HK or BVI?

Why not choose UAE directly if you're okay‌ with spending 184 days in the desert?

 

[batak]

That's a good option indeed to spend the best time of the year > 184‌ days and the rest where summer is cooler. I had that in mind too

 

[TheCryptoAnt]

While this is true, nobody is looking at this in Emirates.

In practice you can own and control whatever you want from Dubai and its all fine.⁠

 

[Martin Everson]

Emirates signed and committed to doing so more than a year ago. See below‍ and get up to speed.

https://www.offshorecorptalk.com/th...es-with-no-substance-with-ubos-country.36103/

 

[TheCryptoAnt]

'Since March 2021 twelve‍ countries now automatically share information on companies with no economic substance and where beneficial owners⁠ are non-resident.'

Yeah but even my cat knows how to circumvent this.

Also hes talking⁤ about living in UAE, where reality is that nobody cares where your business is located⁣ and/or if you trigger any PE there

 

[JimBeam]

But it the owner of the company (UBO/Director/Shareolders) has UAE visa and is employed⁣ within the company (has visa and emirates id) he would be then considered a resident⁢ and that won't be an issue (at this point but maybe they can complicate things︀ along the way/later on).

 

[Martin Everson]

You have a very smart cat then....just saying.

But in real world things have moved‍ on.

 

[TheCryptoAnt]

with no economic substance

Most UAE companies have‍ that sorted out already.

Also the dude is talking about living in UAE, where reality⁠ is that nobody cares where your business is incorporated.

 

[Martin Everson]

As always I will let‍ people find out the hard way how things really work.