SINGAPORE COMPANY TAXES ON FOREIGN INCOME IF REMITTED?

[Marzio]

Mike Forman said:
I don't believe being eligible for offshore 0pct taxation is very feasible in Singapore, unless you are a multinational and have everything structured out well by a legal / tax team.
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Exactly, Uber is using SG as headquarter to receive divends tax free from Uber B.V.

Unless you have that kind of structure, SG is not your place.

Mike Forman said:
With the new draft in Hong Kong and the pressure from outside I'm not sure anymore it's still easy feasible
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You still "could" pull it off if your HK company is not considered a MNE group ( A group that includes at least one entity or permanent establishment that is not located or established in the jurisdiction of the ultimate parent entity of the group)

 

[bigbite100]

Mike Forman said:
All Singapore companies indeed require a resident director, which can be a nominee director. The operations can be handled outside Singapore as non resident (and second director) but if you want to pay yourself a salary it will be taxed 22pct.

I don't believe being eligible for offshore 0pct taxation is very feasible in Singapore, unless you are a multinational and have everything structured out well by a legal / tax team.

Hong Kong is or at least was still feasible to claim for offshore at 0 pct, but you will need a good auditor / tax lawyer as they ask a lot of work proof. The process takes one year back and forth.
With the new draft in Hong Kong and the pressure from outside I'm not sure anymore it's still easy feasible. In general 0 % tax and offshore is not anymore as before and before find a low tax jurisdiction and pay some tax.

You might get away with the offshore setup but once they ask questions and look around you will be finally taxed in the country you have received the income with all the fines, interest and fees of your tax lawyer.
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@Mike Forman and @marzio Thank you for the information. I understand now, that Singapore will really not be possible and even Hongkong might not be that clean/easy.

So basically the only alternatives would be to use the Malta/UK solution, Dubai/RAK or "exotic" countries like Seychelles an so on?

 

[Marzio]

bigbite100 said:
So basically the only alternatives would be to use the Malta/UK solution, Dubai/RAK or "exotic" countries like Seychelles an so on?
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The best for you as a CY resident would be using the Maltese resident non domciled company approach.

If you decide to move then Dubai freezone is best.

Seychelles is simply not relevant in this day and age.

 

[bigbite100]

marzio said:
You should look into Maltese resident non domiciled company managed by a Maltese resident director.

The company will receive income from US and it will not be taxed if funds are not remitted to Malta, then you could distribute dividends tax free in Cyprus.

Use a UK LTD treaty non resident company (meaning it will be tax resident in Malta but not domiciled in Malta) instead of US LLC so you have access to EU EMI bank accounts.

The Maltese resident director should not be a nominee director otherwise you will fall into ATAD3
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What would be the reason to use the UK Ltd company? Cant I just send the money from the US LLC to the Maltese company?

marzio said:
The best for you as a CY resident would be using the Maltese resident non domciled company approach.

If you decide to move then Dubai freezone is best.

Seychelles is simply not relevant in this day and age.
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I plan to stay in CY.
Dubai would not work in that case or Malta better because its cheaper/easier?

Last edited: Nov 8, 2022

 

[Marzio]

bigbite100 said:
What would be the reason to use the UK Ltd company? Cant I just send the money from the US LLC to the Maltese company?
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Because dealing with one company is simpler and with a UK LTD you will not have to remember to file form 5472.

If you don't care you can transfer profits from the US LLC to UK LTD resident in Malta.

bigbite100 said:
Dubai would not work in that case or Malta better because its cheaper/easier?
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Dubai setup would be more expensive.

 

[fshore]

Is it clear that Cyprus doesn't consider a US LLC as a corporation? Many other countries do, and will treat the profits as dividends, even though the IRS doesn't consider it as profits.

 

[Marzio]

fshore said:
Is it clear that Cyprus doesn't consider a US LLC as a corporation?
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@CyprusLawyer101 said once that US LLC isn't treated like a corporation in Cyprus and i took this for granted but even in case US LLC would be treated like a company, by managing the US LLC from Cyprus he would create a PE in Cyprus so the result is the same.

 

[bigbite100]

fshore said:
Is it clear that Cyprus doesn't consider a US LLC as a corporation? Many other countries do, and will treat the profits as dividends, even though the IRS doesn't consider it as profits.
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Thats a good question. is it possible to find a valid answer to this and where? just a google search couldnt help.. and i am not sure if it is written in law if the US LLC is treated as a corporation

 

[Marzio]

bigbite100 said:
is it possible to find a valid answer to this and where?
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https://www.offshorecorptalk.com/threads/us-llc-cyprus-residency.28570/#post-213722
It was @CyprusLaw that said that, not @CyprusLawyer101 but the bottom line is the same.

 

[bigbite100]

marzio said:
Because dealing with one company is simpler and with a UK LTD you will not have to remember to file form 5472.

If you don't care you can transfer profits from the US LLC to UK LTD resident in Malta.



Dubai setup would be more expensive.
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Hello @marzio , I would like to compare the costs. Do you provide a Dubai offshore dividend setup or can you recommend someone for that?

Thank you in advance

marzio said:
The best for you as a CY resident would be using the Maltese resident non domciled company approach.

If you decide to move then Dubai freezone is best.

Seychelles is simply not relevant in this day and age.
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And why is Seychelles not relevant? They arent on the black list country, company creation is very cheap and remote possible and there are also a few fintechs /banks which accept the bank account. I know they dont have a good reputation, but the "hard facts" speak for it or not?

Last edited: Nov 9, 2022

 

[bigbite100]

@All Any opinions on why Seychelles is not relevant anymore? Always looking to learn something new 🙂

 

[Mike Forman]

bigbite100 said:
@All Any opinions on why Seychelles is not relevant anymore? Always looking to learn something new 🙂
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1)Rapidly get a free red flag for tax evasion in Europe and possibly US (I have no experience with US) unless you are based in Asia.

2)As good as impossible to open a bank account (you can try Hong Kong and Singapore but would be even more difficult than a Hong Kong corporate account.

If some European authority notices Seychelles = alarm tax evasion. It was on the EU blacklist last year and can end up there again at any time.

3) Requirement of handing over your bookkeeping.

 

[bigbite100]

Mike Forman said:
1)Rapidly get a free red flag for tax evasion in Europe and possibly US (I have no experience with US) unless you are based in Asia.

2)As good as impossible to open a bank account (you can try Hong Kong and Singapore but would be even more difficult than a Hong Kong corporate account.

If some European authority notices Seychelles = alarm tax evasion. It was on the EU blacklist last year and can end up there again at any time.

3) Requirement of handing over your bookkeeping.
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Thank you for the helpful information! Great explanation.

 

[Meta]

Mike Forman said:
1)Rapidly get a free red flag for tax evasion in Europe and possibly US (I have no experience with US) unless you are based in Asia.

2)As good as impossible to open a bank account (you can try Hong Kong and Singapore but would be even more difficult than a Hong Kong corporate account.

If some European authority notices Seychelles = alarm tax evasion. It was on the EU blacklist last year and can end up there again at any time.

3) Requirement of handing over your bookkeeping.
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I'm wondering if it's the case for all/most zero-tax "classic offshore" jurisdictions, or just Seychelles. Is it the same with BVI/Cayman Islands, for example?

 

[Mike Forman]

Remoddy said:
I'm wondering if it's the case for all/most zero-tax "classic offshore" jurisdictions, or just Seychelles. Is it the same with BVI/Cayman Islands, for example?
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That's with all the classic offshore, which have also lost their appeal as some have a public register and require to file the accounting files.


At least using them in Europe. If you want to do transactions in Europe with those you need to add a layer, such as HK or SING company. In China, Hong Kong, Singapore offshore as BVI, Samoa, Seychelles etc are still accepted and BVI is very common as a holding, but hard to open a bank account