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Best offshore jurisdiction for collecting AdSense income?

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Thank you!

I am not very much oriented to︄ Islamic jurisdictions since as a western I see them very far from my culture and︅ thus I would not like to take up residence there.
I know for example in︆ UAE you can come back 1 day every 6 months but if this rule changes︇ in the future it may be an issue since I do not see myself spending︈ time in Dubai now or in the future.

The reputation of the jurisdiction is not︉ an issue (for example for Vanuatu) since Google or the other ad networks do not︊ care where to send the payment.
The problem is when it comes to banking there︋ since Google would need a bank located in Vanuatu, for example.

The Channel Islands may︌ be interesting but I guess to completely avoid taxes I have to reside in another︍ country.

I can take out 80-90% of the company revenue since we have only very︎ little expenses to run the business that's why it is very important for our target️ country to have 0 corporate tax.

At the same time, I want to obtain a‌ residency permit in a country, where in the future I may spend a few months‍ living there but that does not require staying 180 days per year as an example.⁠
For instance, I was looking at something like the Bahamas but this was just an⁤ idea.

The key points are a country with 0 corporate tax + local baking (for⁣ Google) and another country (or the same) with a more western-like lifestyle with a warm⁢ climate.

UAE is the perfect option apart from the fact that I do not like︀ taking residency there.
 
That is what I thought. But I have⁠ been surprised at the lack of any real presence of Islam. That is at least⁤ if you stay on the main roads and most of Dubai, Abu Dhabi. If you⁣ go into Sharjah and Ajman, you will see more of people I would describe as⁢ Islamic. People who have been living there for ten years have not been outside the︀ Dubai conurbation.

At least in my experience Muslims in Dubai are more liberal than me,︁ but that is not saying much 😉. Girls in hijabs smoking shishas, Arabs done up︂ like some plush beatnik, fat slobs with their trophy wives, prostitute calling cards all over︃ the place in certain areas, likely-prostitutes strutting about in skimpy clothing all come to mind︄ before Allah-u-abah. Have a look at the next ruler of Dubai's Instagram. I forget his︅ name.

Marina seems to be the most liberal/Western place of all, and most European, but︆ mostly Russian, Ukranian.

It's possible, but if it happens it will come from outside︊ the country, so you probably won't be able to expect much better elsewhere.

That's what I thought until my USD wires began bouncing and two merchants cut me off.︍ With what The IMF, OECD, WEF, UN etc. are up to I am not taking︎ chances on backwaters again.

Maybe a consultant could put something together that is between countries.️ This company has been recommended on the forum - Jurisdictions - The Sovereign Group

There was a guy on here who did Isle of Man formations, forget the name.
 
So we can get a bank account︇ for Google adsense in almost any country with Transferwise, Payoneer, or Bankera and use it︈ to receive payments?
 
@4br what about privacy when using a UAE company? Is your name on some register‌ that anyone with half a brain and an internet connection can find? What appeals me‍ about US LCCs such as New Mexico and Wyoming is the secrecy they offer from⁠ the average Joe (and then some more).

@hireblade89 sounds like you are getting close to⁤ your solution. Do you actually do work in your business? Are you in it with⁣ other people?
Because the UK could be a good place for you. Any foreign income⁢ doesn't even need to be declared, AS LONG AS you don't bring it in the︀ UK (i.e. wire it to a UK bank account). The only catch would be CFC︁ regulations. But if your ownership is less than a certain amount and maybe with the︂ fact that you had that business from before, you could be ok.
 
@Asterion I am the owner of half the company so I think this will trigger‌ CFC regulations? What you are meaning is having a UAE company and living in the‍ UK as a non-dom? The problem is that I am a major shareholder of the⁠ company.
 
Yes, that's what I meant. I think being an⁤ owner could be ok, it depends on the amount of work that you can demonstrably⁣ put into it. The fact that somebody else is also an owner sounds good to⁢ me. If you have employees, they could potentially do all the work and you might︀ just be a fat cat owner cashing in. I can't give final advice, but the︁ whole UK Resident-but-Non-Dom might be worth a check.
 
@hireblade89, did you make any research about UAE company taxation on US income?

All your ad networks like Applovin, Admob, etc. require to fill a US tax form (W8-ben-e‌ or smth). The United Arab Emirates have not sign a double taxation agreement with the‍ United States of America yet. So it looks like you have to pay up to⁠ 30% of all revenue generated by US users (in-apps and ad revenue). It will be⁤ deducted from your earnings by ad networks.

Does anybody know how to be exempt from⁣ this tax for UAE company?
 
@krowxela I read about this︀ and it can be an issue with networks like AppLovin. Admob is not an issue︁ since in UAE you will be paid by Google Ireland Ltd, not the US entity,︂ I read it in their terms and conditions by setting the billing country as UAE:︃ Google AdSense - Terms and Conditions

The problem still remains with other US-based Ad-Networks (like︄ AppLovin etc), but since the only one which is not flexible was Google for the︅ other I think you can create a foreign company with UAE shareholder & director in︆ the BVI for example, or other tax-heaven jurisdiction that has a tax treaty with the︇ US and billing the Ad-network from it?

Is this a feasible solution?
 
Not sure about Admob. They are collecting your︁ US tax info. Seems like they will deduct it from your US income. It's better︂ to ask someone with real experience of such setup.

Company in the BVI may be a solution for︆ other ad networks. Even though I don't know how difficult it will be to open︇ a bank account for such setup - BVI company with nomenee director and UAE company,︈ as beneficial owner.
The other issue is automatic exchange of information for tax purposes (oecd?).︉ if you have a residency in UAE, then UAE banks will not send the info︊ to your country. Have no idea how it will change if you add the BVI︋ company into the formula.

Any ideas? We can go to PM. I can't PM you︌ here by some reason.
 
Yeah there are asking for tax information︃ but I do not think that it is the Google LLC US entity that will︄ pay you, but I really do not know if they will apply the 30% cut︅ on US revenue even if they pay you with their Ireland subsidiary.

I can't PM︆ you either. I left you my contact on your profile to further discussion.
 
what about Georgia? they have 0% WHT on royalties and their︄ DTA is soviet-union USA tax treaty (no LOB)

You may have a 1% freelance setup︅ in georgia and get the royalties wht free at 1% or an international company at︆ 5%. In theory also a virtual private zone but that seems to be difficult nowadays︇ due to an aggressive position taken form their revenue service on it.
 
If there⁣ is no LOB that sounds like a very good option. However I can't imagine the⁢ US has not put something into place to counter this.

I am not really into︀ the tax rates in Georgia? Is there somewhere I can find information about this?
 
Hello, I studied the US LLC setup with UAE residency but Adsense will apply the‌ withholding tax, unfortunately. When you complete the tax form on the AdSense dashboard you have‍ to enter the LLC as a disregarded entity and then they ask your residence when⁠ you input UAE they said there is no tax treaty with the US and apply⁤ the 30% tax.
If you input your UAE company created as a UAE resident it⁣ is the same, in the form it shows that the US does not have a⁢ tax treaty with UAE so Google applies the 30% tax.

Is there any 0 tax︀ solution for Adsense at the moment? The only way we can achieve that I think︁ is through a country that has 0 % tax but also a treaty with the︂ US, don't know if it exists.
Otherwise, there is the Malta solution with NHR in︃ Portugal for example but it is not a 0 % tax solution.

Even opening a︄ UAE company as a UAE resident would trigger the 30% tax.
 
Hi diginomad,

I read your post just now, and with horror. I can't︈ believe different people belonging to the same professional body can give such completely different answers.︉ Seriously, they should be put in a cage with no food or water until they︊ have agreed on something. Thank you for sharing your experience with these "professionals".

I'm in︋ your same situation (soon to be launched app-based business whose revenue will necessarily have to︌ come from IAP with Google and Apple, so no way to have it through Stripe︍ or the like).

Did you have any progress?

I was thinking about a SM US︎ LLC that either owns or that extracts revenue from an Estonian limited company, which publishes️ the app. You'd be dealing with European Google and Apple (based in Ireland or Luxembourg‌ I think) and the only source of income of the US LLC would come from‍ Estonia.
The Estonian limited company would not have any tax on profit until they are⁠ paid as dividends. All retained earnings are untaxed. It is to be seen if having⁤ another company as the shareholder works in terms of privacy, because that's almost more important⁣ than low taxation to me.
 
I read the whole thread, I found a lot of mistakes, errors, misleading, misinterpreted information.‌
so I want to clarify some things here
let's break it down one by one:‍

first of all, we have to distinguish between Admob and AdSense :
Google AdMob︀ is a mobile advertising company(it's an ad-networks like AppLovin..)while Google Adsense is for websites.
that's why we have to understand the difference between Admob︅ and AdSense because each one has its own tax rules and regulations
AdSense POV: in︆ that case, Google will deduct taxes when NRA creators earn income from viewers in the︇ US.as you said:
that's correct only from AdSense perspective︊ (if you are a YouTuber, blogger, content creator and you have a US audience)
But then you said :
so it appears⁠ that you are dealing with Admob, AppLovin.. Not Adsence
in that particular situation :
Admob POV: Google consider your earnings as Royalties (which is an FDAP, and FDAP Income is⁤ subject to US Taxes) that's why US Company(in that case Google) will deduct up to⁣ 30% as withholding tax; Meaning your earnings would be subject to a 30% withholding tax(it⁢ can be reduced(tax treaty)).
 
The second thing I want to clarify is:
who told you⁢ that? that's wrong
You are an ECI/ETBUS:
-->if you have at least︀ one dependent agent(Companies or individuals who provide services exclusively to you; I mean dedicated service︁ for you and only you)
-->or if you operate in the US through a︂ “permanent establishment;(an office or other fixed place of business).
-->or you performed services inside︃ of the US.
-->if you lived in the US long enough to pass the︄ “substantial presence test.”
My sources are IRS resources; code sections, Court cases
https://www.irs.gov/individuals/international-taxpayers/effectively-connected-income-eci
as an︇ NRA owns a US SMLLC if the income received is US Sourced it doesn't mean︈ you are subject to US taxes, in most cases even with US Source income you︉ Won’t pay any taxes.
You are subject to US Taxes Only if you have:
  1. ETBUS /ECI
  2. FDAP
Resources:
https://www.irs.gov/individuals/international-taxpayers/effectively-connected-income-ecihttps://www.irs.gov/individuals/international-taxpayers/nonresident-aliens-source-of-incomehttps://www.irs.gov/individuals/int...ed-determinable-annual-periodical-fdap-income
It's clear to me(I am a foreigner too just like you)I hope it'll be clear for︍ you.
like I stated⁤ before it's not ECI it's FDAP(Royalty)
regarding "CPAs": well well well hahaha,⁣ let's break them down one by onens2
in your particular situation there are two types of revenue︃
Ad revenue and IAP revenue:
Ad revenue from Admob is considered as royalties.
regarding IAP:︄ IDK (I am eager to know)

That's correct Unless︇ there is DTA.
it's not your︌ choice to decide whether to pay taxes or not
in that case google/apple decides to︍ withhold taxes or not.
Correct.
Correct.
US SMLLC owned by a person files W8BEN.
US SMLLC owned by a foreign company files‍ W8BEN-E.

Correct.
P.S: 1040NR you don't have to file it as⁣ Neil said.

that's silliness.

nonsense

no comment

read my first and second replies

If your goal is to pay less/avoid withholding taxes by setting up a company︂ in UK or Cyprus or even The moon, it doesn't matter at all. because at︃ end of the day google/apple will withhold taxes whether your offshore company is in UAE,︄ UK, USA...
regarding DTA with the US; what matters is UBO residency.
P.S: UAE doesn't︅ have a tax treaty with the US
Thai has one.
Exactly.
I hope you read my first and second replies
Now I'll reveal my solutions to︎ this particular problem(30% withholding tax).
  1. Make a claim (a tax treaty benefit) for️ a reduction on the tax withheld from U.S. income you may receive in your account.‌ United States Income Tax Treaties: United States Income Tax Treaties - A to Z |‍ Internal Revenue Service
  2. Use a US C-Corp so that you can give them(the Withholding Agent⁠ i.e Google)a W-9; if you operate out of a corporation, you give them a W-9⁤ they won't withhold taxes, and then you can either pay yourself as expensive OR pay⁣ all of your profits to your LLC (LLC would be tax-free)
  3. As an SMLLC owner,⁢ you can elect to treat your LLC as a corporation for tax purposes. If you︀ do, the corporation must file Form 1120 (U.S. Corporation Income Tax Return) to︁ report and pay tax on corporate income. Form 5472 must be included with Form 1120︂ to report your ownership interest. the goal of that election is to provide a W-9︃ form.
P.S: these solutions require you to work with US Accountant
hap¤#"
 
Thank you for your suggestions.

The problem is if︆ the US C-Corp is managed and directed outside the US are we sure it can︇ be seen as a US opaque entity even if it is a C-corp?
From what︈ I understood the place of management and controls determine where the company resides.
In your︉ particular case, you can reside in a country that has no tax treaty since the︊ revenue you take from the C-corp to your LLC is not considered royalties, right? So︋ no 30% will be withheld.
Can't this structure be seen by IRS as a way︌ to circumnavigate the 30% tax since you basically create a C-corp but take all the︍ revenue of it outside of the company with your LLC and the C-corp is also︎ managed outside US. Is this the solution you are using for your company?

At this️ point the same may work for an LTD for example or any other opaque company‌ that has a tax treaty with US and then you take out all the revenue‍ as expenses before paying the corporate tax.
 
Another consideration for people earning royalties through adsense that︆ I just wanted to add.

"A C with 60% or greater total yearly $ passive︇ revenues (royalty income) represents a personal holding company ("PHC") for US tax purposes. A PHC︈ has restrictions on accumulating profits. (1) So, a PHC has to pay out all of︉ its taxable income each year as a dividend. This statement means the C cannot let︊ the excess cash stay in the C. The C pays out the profits each year︋ or if not, the C will face a 20% penalty tax on profits not paid︌ out when its files its corporate tax return. (2)"

(1)Treasury Regulation Section 1.543-1(b)(3)
(2) Section︍ 541
 
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