Looking for someone to consult me on the best way to cash out Crypto with minimal tax.

[JohnLocke]

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[totlori9]

Just discussed this with a friend. There is actually a rather simple 4th option.

Bulgaria has a double tax treaty with the UAE. In the UAE there is no income tax, VAT registration threshold is 375,000AED which is just below 89,000 €. He rents a storage facility located in the UAE which he sublets on paper. He uses a made up sublease contract with an offshore company that says the company rents the storage facility from him as a virtual address. Income from renting out a permanent establishment in the UAE is taxable in the UAE (at 0%) according to all OECD double tax treaties. This way he can cash out 89000€ worth of crypto a year (he does the same for his wife and his dad so 3×€89k/year actually) proving with the sublease contract to his local tax man that he earns this amount completely legally with a 0% tax.

 

[niggashit]

You need to use OTC trading desk in order to cash out your crypto assets. I recommend opening a Private wealth client account at Barclays in UK as they do not tax for non-residents.

The other way is to use some kind of Family office to hide your details.

Last edited by a moderator: Nov 8, 2018

 

[totlori9]

niggashit said:
The other way is to use some kind of Family office to hide your details.
Click to expand...

He stated multiple times throughout the thread that he doesn't want to hide the income, but want's a way to be able to freely spend the funds under his name and be able to show something to the tax man where the funds are from that has a less than 10% tax should thay start asking questions.

 

[Jessie]

totlori9 said:
Just discussed this with a friend. There is actually a rather simple 4th option.

Bulgaria has a double tax treaty with the UAE. In the UAE there is no income tax, VAT registration threshold is 375,000AED which is just below 89,000 €. He rents a storage facility located in the UAE which he sublets on paper. He uses a made up sublease contract with an offshore company that says the company rents the storage facility from him as a virtual address. Income from renting out a permanent establishment in the UAE is taxable in the UAE (at 0%) according to all OECD double tax treaties. This way he can cash out 89000€ worth of crypto a year (he does the same for his wife and his dad so 3×€89k/year actually) proving with the sublease contract to his local tax man that he earns this amount completely legally with a 0% tax.
Click to expand...

That is indeed very interesting. So, I would effectively be paying 0% total and be able to show source of income?
I suppose the only expense will be the cost of renting that space though?
And establishing the other offshore company that pays me the rent, or it will be a made up, non existent one? And they will be paying me with crypto directly which Ill be cashing out myself?



How about this.
A company of a friend who needs expenses pays my HK company for consulting in crypto. Since this is foreign income for HK I owe 0% income tax there. Then the HK company sells that crypto using business account at an exchange and wires it to the company bank account. Then from that bank account I wire it to my personal bank account as dividend and pay 5% dividend tax in my country.

Only thing is Im not sure if Bulgaria has tax treaty with HK, so far Im unable to find such online, which would be a shame.

niggashit said:
You need to use OTC trading desk in order to cash out your crypto assets. I recommend opening a Private wealth client account at Barclays in UK as they do not tax for non-residents.

The other way is to use some kind of Family office to hide your details.
Click to expand...

Selling the crypto for cash is the easy part. I need a way to pay minimal tax on that income and report it so I can openly spend it.

 

[totlori9]

Bulgaria DOESN'T have a DTA with HK.

Comprehensive Double Taxation Agreements concluded

Jessie said:
That is indeed very interesting. So, I would effectively be paying 0% total and be able to show source of income?
Click to expand...

Yes.

Jessie said:
I suppose the only expense will be the cost of renting that space though?
Click to expand...

Yes.

Jessie said:
And establishing the other offshore company that pays me the rent, or it will be a made up, non existent one? And they will be paying me with crypto directly which Ill be cashing out myself?
Click to expand...

You only have to show the tax man the sublet contract so the company that rents it from you only appears there as a name, and that's all. You don't have to establish one, you have a HK one currently, haven't you?

Depending on how you cash out the crypto to your local IBAN the tax authority will see something like the following: You have received incoming wire transfer from a payment processor, lets say Mistertango. If they ask you for the source of funds you provide the contract as proof. If they contact Mistertango to provide data about your personal account with them, and they do they will only see that you received bitcoins to your MT account won't they? So all they can see is you provided a contract for source of funds that rhymes with your wire transfer/MT data.

And it since Bulgaria DOES have a double taxation agreement with the UAE renting a storage facility in the UAE creates a permanent establishment there, which make it a business income that is taxable there (at 0%).

Last edited by a moderator: Nov 8, 2018

 

[Jessie]

You my friend are a genius!

I doubt even a consulting agency would have come with something better.
That's why I like internet forums!

By the way, do you think someone might find suspicious the big different between the price which i pay to rent it and the major markup i have when subletting it?

Actually do I even need to rent a real space or just make the papers?

totlori9 said:
Bulgaria DOESN'T have a DTA with HK.
Click to expand...

Ok that's quite a bummer BUT what if I get nominee director that is Chinese? That would fix that need to pay corporate income taxes here in Bulgaria on the profit of that company since it will not be deemed controlled from Bulgaria and I'll still owe only the 5% dividend?

Last edited by a moderator: Nov 9, 2018

 

[totlori9]

Jessie said:
Ok that's quite a bummer BUT what if I get nominee director that is Chinese? That would fix that need to pay corporate income taxes here in Bulgaria on the profit of that company since it will not be deemed controlled from Bulgaria and I'll still owe only the 5% dividend?
Click to expand...

I honestly don't know the answer to that question. You are the only shareholder? Ask a local accountant how Bulgaria treats dividend income from a non treaty country, and don't forget if it is considered a CFC by your local laws chances are likely you'll have to pay more than 5%...

Jessie said:
You my friend are a genius!

I doubt even a consulting agency would have come with something better.
That's why I like internet forums!

By the way, do you think someone might find suspicious the big different between the price which i pay to rent it and the major markup i have when subletting it?

Actually do I even need to rent a real space or just make the papers?
Click to expand...

I wouldn't make the papers. It is always nice to be able to show the tax authorities your original contract too that you rented it in a way that allows you to sublease. Also you'll be able to provide a bank statement showing you actually paid for it before renting it out.

A major markup is not a problem.

Last edited by a moderator: Nov 9, 2018

 

[niggashit]

I thought you were talking about millions but it seems 5 digit thing. It's not easy to cash out 7 or 8 digits worth Crypto. I never trust nor use an EMI account for this.

 

[Jessie]

niggashit said:
I thought you were talking about millions but it seems 5 digit thing. It's not easy to cash out 7 or 8 digits worth Crypto. I never trust nor use an EMI account for this.
Click to expand...

I can cash out 7, 8 digits but in this case I need to make it in a way where it is legal, i pay some minimal tax and can openly spend the money.

You don't have to cash out everything of course but would be nice to have few M clean income that can be proven and shown.

 

[niggashit]

Jessie said:
I can cash out 7, 8 digits but in this case I need to make it in a way where it is legal, i pay some minimal tax and can openly spend the money.

You don't have to cash out everything of course but would be nice to have few M clean income that can be proven and shown.
Click to expand...

I think PwC can help you in this case. They can prepare this for you. DIY is hard. PwC also writes a letter that you can show to anyone.

 

[negon]

I wonder why you are here on the forum and asking for all these questions with so much money available! PwC or some of the other TOP 5 world accounting firms should be the first and only stop for you in order to get help.

What is the problem to spend 10 or 20,000 euro for consultancy and help with one of these if you have millions you can get clean??

 

[Jessie]

@negon, check the title of the thread.
Obviously im looking to hire someone.

I wasn't even aware of PwC or that such white hat companies can do that kind of consulting adequately.

Which are the top consulting firms that are appropriate for that kind of consultations?

 

[blizz]

and why didn't you asked some of the posters here for advise if that is what you are looking for? Alternative you could try Turner Little they advertise here even with a fat banner 😀

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[Jessie]

@blizz Really, just read the OP. That is literally what I'm asking there. lol

 

[niggashit]

PwC is not white hat. They are the grey hat. They do not advertise in Public but you can see their work from Paradise papers.

 

[negon]

niggashit said:
PwC is not white hat. They are the grey hat. They do not advertise in Public but you can see their work from Paradise papers.
Click to expand...

Can't agree more with this!

 

[blizz]

Jessie said:
@blizz Really, just read the OP. That is literally what I'm asking there. lol
Click to expand...

You could write on their walls as many are doing here, since it's not allowed to contact people around unless they are asking for it this is your best option. Or, you check signatures on the few around.

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[Jessie]

niggashit said:
PwC is not white hat. They are the grey hat. They do not advertise in Public but you can see their work from Paradise papers.
Click to expand...

ok good to know, ill ask them then

and what about Uk & Offshore Company Formation Agents | Turner Little
gray, black hat?

 

[niggashit]

Jessie said:
ok good to know, ill ask them then

and what about Uk & Offshore Company Formation Agents | Turner Little
gray, black hat?
Click to expand...

They are **ANON**. Seems fake. You will lose your figures with them .