Georgia - Low cost setup with individual entrepreneur scheme

[ska]

I think you can just invoice your foreign company as an⁤ individual entrepreneur and pay 1-3% taxes if you're doing the work yourself

 

[Marzio]

As soon‍ as RS will notice that 99% of your income comes from invoicing an offshore company⁠ owned by you imagine what will happen next.

 

[ska]

1. How can they see that it comes from a specific client? They don't ask⁠ for invoices or anything, just monthly declarations of revenue
2. We're talking about an US⁤ LLC, how can they know it's managed by yourself?

Maybe you're right, I'm just missing⁣ some parts I guess

 

[khinkali]

I'm not saying that you're wrong,‌ but isn't this what everyone says before they get prosecuted? I mean none of those‍ people in jail or with massive fines, expected to be caught.

Once you cross the⁠ line, you must never ever make an enemy of anyone who knows or suspects your⁤ illegalities. In Dubai, it's "don't shout at your neighbour for playing loud music, if he⁣ can send the morality police round to count the toothbrushes and get you arrested for⁢ fornication" and in most places it's "don't fail to pay your blackmailing bookkeeper who knows︀ where the money went". Some people thrive on illicit dealings, but it's a very bad︁ move for those who aren't prepared for that lifestyle.

 

[ska]

2. We're talking about an US LLC, how can they︂ know it's managed by yourself? >> I need to file the Form 5472 once a︃ year with the IRS.

Will USA with the FACTA report my revenues to Georgia? If︄ I search online I see they signed the FACTA agreement... is this in both ways?︅

 

[Marzio]

Maybe in Georgia works differently but usually when you sell B2B you have to provide an‍ invoice.

If you are 100% sure that you don't have to provide invoices when selling⁠ B2B then there's no way for RS to know that you are managing a Delaware⁤ LLC or New Mexico LLC, FATCA works only in one direction, US isn't part of⁣ CRS and US and Georgia don't have a tax exchange agreement.

 

[TheCryptoAnt]

weirdly enough, they do. But only the US recognizes it.

The US started applying the USSR‌ one to all the independent nations after 91, but from the GE side they dont‍ recognize it.

 

[khinkali]

When I wrote "Once you cross the line, you must never‍ ever make an enemy of anyone who knows or suspects your illegalities" I meant that⁠ if you make an enemy of someone who knows your dealings, then you have a⁤ risk. This can be a provider, business partner, family member, etc. Some people are better⁣ at managing these risks than others.

 

[Marzio]

I'm not talking about tax treaty‌ between US and USSR, i'm talking about tax exchange agreements where countries without double tax‍ treaty agreements exchange tax informations.

https://www.oecd.org/countries/caymanislands/taxinformationexchangeagreementstieas.htm

 

[Houdini]

Do you feel it is still interesting ?

 

[Houdini]

You comment on the structure‍ of ownership right or do you mean in general?

 

[khinkali]

The comment is about this:

My point⁠ is just that a "How can they know?" based approach (i.e. relying on not getting⁤ caught) has risk if you fall out with someone who knows about the scheme.

 

[Houdini]

got it, thank you for elaborating. I agree someone should keep his business affairs close‌ and not tell anyone about anything unless it is necessary.

 

[Ilia Kekutia]

I agree with you, well said. In order to attract clients, many lawyers and︄ law firms especially, who are far from tax issues mislead people about the status of︅ both small businesses entrepreneur and IT companies in Georgia. Therefore, be sure to consult a︆ good tax expert first, because the tax legislation of Georgia is very complex and not︇ everything is clearly written. You can check out our very good article here on small︈ business entrepreneur here.

 

[uplana]

Nice to have a repr. from the company INC.GE around, I'm sure you will get‌ attraction here since people in the past have been looking for services you offer.