banafinfodafuggiano said:
pay ZERO corporate Tax since 100% of my income is sourced from outside these countries?
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If your company is tax resident of some jurisdiction with territorial tax system it always leaves a question where the income is sourced and some day you might have to prove it somehow.
This is why Singapore is probably the best jurisdiction for such approach, as it doesn't tax or issue tax residence certificate based on incorporating a company there, so you could get away with the company not being tax resident anywhere, and you can be the company's shareholder and employee/representative. Probably best is not to be the sole director though depending on your exposures.
Its worth noting that Singapore is not a "banana republic" but a reputable financial hub. On top of that its probably one of the best structure for high-risk activities (even arms dealers/defence industry uses it a lot, and they don't have too many great alternative options).
Under Singapore tax law, the tax residency of a company is determined by where the business is controlled and managed, so you could present to Singapore tax officials that board meetings are held in e.g., Bahrain (0% tax country), or in limited cases (Estonia, see below).
However you probably want to have a permanent establishment registered somewhere so you could have some substance for compliance purposes as it would be great to have some fixed place where the company's operations are at least partly performed, and to have a tax number somewhere (and in result better access to banking).
For this purpose I can recommend getting a substance package from Estonia (e.g., rent office and hire one Estonian resident professional director or employee part-time in Estonia). Estonia is a great choice for the following reasons:
1) Estonian legislation doesn't allow claiming foreign companies as tax resident in Estonia. It can only tax its PE.
This means Estonia can only tax the profits attributable to the PE, which can as well be 0.
2) even if profits are attributable to the PE, then profits of the PE are not taxed before the profits/assets are taken out from the PE, and not if the assets are returned to the PE in one year
3) you are not obligated to register a branch office, like in many jurisdictions (but can still register for tax and register a PE) and do not need to follow local accounting rules for the PE
4) it helps to access Estonian and other EU financial institutions since you would have established EU presence this way
5) it is even possible to structure it so to have the PE registered, but it will not even be considered a PE under the tax treaty, so the PE is not taxable either.
Depending on your personal tax residence or if you are nomadic it can be a great structure. Happy to help with the setup.
Last edited: Oct 1, 2023
