Gibraltar vs BVI

[daniels27]

Roo said:
2) Please suggest any other option that would be a good fit where banking is easier (with EMI support).
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Thank you @Forester I would be interested too.

Roo said:
An agent suggested Payoneer and Airwallex for BVI banking but said none of them will offer a company card.
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They do not offer this for BVI?

https://www.payoneer.com/commercial-card/
https://www.airwallex.com/eu/business-account/cards
Just got my own interest. Why do you want a company card to pay? Aren't cash backs much better on personal cards? And even if you pay personally, you can still get the stuff reimbursed by the company if that is needed. Or what am I missing here?

 

[Roo]

daniels27 said:
Thank you @Forester I would be interested too.


They do not offer this for BVI?

https://www.payoneer.com/commercial-card/
https://www.airwallex.com/eu/business-account/cards
Just got my own interest. Why do you want a company card to pay? Aren't cash backs much better on personal cards? And even if you pay personally, you can still get the stuff reimbursed by the company if that is needed. Or what am I missing here?
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I've been told by an agent that does company registrations for BVI that they don't offer cards for BVI, not sure if it's accurate.

I wanted a company card as the money wouldn't have to go through my account in case that gets reported to my country of passport so they don't get ideas to start asking questions. Maybe the company account would get reported too but haven't have issues so far at least by using an EMI.

 

[JustAnotherNomad]

daniels27 said:
It is not taxable unless you remit it to Singapore. Or do the work in Singapore. Just call an agent and ask. I talked to Sovereign.
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But is the company tax resident in Singapore in that case? Or is it just like a HK "offshore" company in that case, without any clear tax residency?
Some countries don't consider companies tax resident where they are incorporated, but where they are managed and controlled.

@Roo What's your personal tax residency? Where do you live, where do you physically perform the work?

 

[daniels27]

JustAnotherNomad said:
Some countries don't consider companies tax resident where they are incorporated, but where they are managed and controlled.
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Almost all. Hence the setup makes sense when you either travel or line on places such as Sark it those countries that lack the possibilities to chase you, i.e. undeveloped ones.

Also, if you live in many countries over a decade you are also better off with a setup like this as you can just register your Singapore company on Hong Kong for two years to pay taxes there, and even bypass the audit requirements. You gain a lot of freedom with Singapore as there will never be tax discussions in Singapore but dividend discussions there.

Even for EUSSR, you can line there for one year and move onwards, the chances that they are going to tax you for one year are not very big. There is plenty of room and tons of exceptions such as tax benefits for inward company migration credits.

And otherwise yes, you will need a resident director in Monaco or something.

 

[Roo]

JustAnotherNomad said:
But is the company tax resident in Singapore in that case? Or is it just like a HK "offshore" company in that case, without any clear tax residency?
Some countries don't consider companies tax resident where they are incorporated, but where they are managed and controlled.

@Roo What's your personal tax residency? Where do you live, where do you physically perform the work?
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The company in my case is tax resident in Singapore.
@JustAnotherNomad I am/was last resident in a high tax EU country but moving around the EU also didn't get me into any issues while doing this.

@daniels27 I spoke to your contact at Sovreign, thanks for the contact info. He cleared things up for me so if my company would be offshore declaring no presence/ties to Singapore and no bank account there it should be tax free however I should beware of tax authorities possibly informing my country of residence if offshore.

 

[daniels27]

Roo said:
The company in my case is tax resident in Singapore.
@JustAnotherNomad I am/was last resident in a high tax EU country but moving around the EU also didn't get me into any issues while doing this.
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Yes as mentioned above if your stay is less than 2 years and you travel a lot, there won't be many issues. Just be careful with counties with closed borders when you approach 183 days. Taiwan is known for detaining people at immigration to pay taxes.

Roo said:
@daniels27 I spoke to your contact at Sovreign, thanks for the contact info. He cleared things up for me so if my company would be offshore declaring no presence/ties to Singapore and no bank account there it should be tax free however I should beware of tax authorities possibly informing my country of residence if offshore.
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Thanks. Then just stay 150 days max per country and they probably won't do much with the report. Or you give them your residency where you only stay 30 days.

 

[JustAnotherNomad]

daniels27 said:
Almost all.
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No, most companies consider companies tax resident due to their place of incorporation by default.
Obviously if you live in another country, then that country could also consider the company tax resident there due to its effective place of management. Then you could be facing double taxation, unless there is a tax treaty.

Singapore is special in this regard, insofar as they pretty much just don't care where the company should pay tax if nothing happens in Singapore.
But that also means you cannot use any of Singapore's tax treaties. It's basically similar to a US SMLLC, with the exception that it's not even a transparent entity.
I would also imagine that banking must be extremely difficult for such an offshore company?

daniels27 said:
You gain a lot of freedom with Singapore as there will never be tax discussions in Singapore but dividend discussions there.
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What do you mean?

daniels27 said:
Even for EUSSR, you can line there for one year and move onwards, the chances that they are going to tax you for one year are not very big. There is plenty of room and tons of exceptions such as tax benefits for inward company migration credits.
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But that would be the same with any other country, no? You could also set up in, say, the BVI, and the risk of the company becoming taxable in Europe would be comparable...?

daniels27 said:
And otherwise yes, you will need a resident director in Monaco or something.
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I believe we have discussed this before and concluded that Monaco actually has a corporate income tax for local businesses...

Roo said:
The company in my case is tax resident in Singapore.
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Yes, because you have a local director and pay tax.

Roo said:
@JustAnotherNomad I am/was last resident in a high tax EU country but moving around the EU also didn't get me into any issues while doing this.
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Many people fly under the radar, so I wouldn't take that to mean much.

Roo said:
@daniels27 I spoke to your contact at Sovreign, thanks for the contact info. He cleared things up for me so if my company would be offshore declaring no presence/ties to Singapore and no bank account there it should be tax free however I should beware of tax authorities possibly informing my country of residence if offshore.
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Yes, your company then simply wouldn't be tax resident anywhere. It also wouldn't have access to tax treaties.
I imagine that banking could be tricky.

daniels27 said:
Then just stay 150 days max per country and they probably won't do much with the report.
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Most high-tax countries will consider you tax resident long before 150 days.

 

[daniels27]

JustAnotherNomad said:
No, most companies consider companies tax resident due to their place of incorporation by default.
Obviously if you live in another country, then that country could also consider the company tax resident there due to its effective place of management. Then you could be facing double taxation, unless there is a tax treaty.
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Yes that's what I meant.

JustAnotherNomad said:
Singapore is special in this regard, insofar as they pretty much just don't care where the company should pay tax if nothing happens in Singapore.
But that also means you cannot use any of Singapore's tax treaties. It's basically similar to a US SMLLC, with the exception that it's not even a transparent entity.
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Yes. But it looks like a opaque company.

JustAnotherNomad said:
I would also imagine that banking must be extremely difficult for such an offshore company?
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No super easy.

JustAnotherNomad said:
What do you mean?
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I mean if you use a company in a country with tax and you travel around or live in St Barth's etc., the country of incorporation is quite likely to come up with tax claims and in the worst case with horrendous exit tax. Singapore with never come with any claim unless you go to Singapore.

JustAnotherNomad said:
But that would be the same with any other country, no? You could also set up in, say, the BVI, and the risk of the company becoming taxable in Europe would be comparable...?
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Correct. But Singapore has way better reputation and better access to banking.

JustAnotherNomad said:
I believe we have discussed this before and concluded that Monaco actually has a corporate income tax for local businesses...
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Sorry. Monaco is none of my business. I just took it as an example as somebody mentioned it for this purpose in as neighbouring thread. Better use Sark or St Barth's then.

 

[Roo]

JustAnotherNomad said:
I would also imagine that banking must be extremely difficult for such an offshore company?
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I use Wise at the moment, they don't really know where the company is tax resident as in they never asked, they have company details and UBO details, no questions asked.

 

[JustAnotherNomad]

daniels27 said:
Sorry. Monaco is none of my business. I just took it as an example as somebody mentioned it for this purpose in as neighbouring thread. Better use Sark or St Barth's then.
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Completely understood. I only thought to point it out for the sake of completeness. 😉 I don't think any of us is going to hire a Monaco resident as a nominee director for our company. 😉

 

[Roo]

@daniels27 , @JustAnotherNomad the downside compared to a US LLC is the annual cost which is from 2.5K USD upwards (Sovreign said they tax 10K for those services). A US LLC will cost based on what I found online so far

 

[Xshore]

Roo said:
@daniels27 I spoke to your contact at Sovreign, thanks for the contact info. He cleared things up for me so if my company would be offshore declaring no presence/ties to Singapore and no bank account there it should be tax free however I should beware of tax authorities possibly informing my country of residence if offshore.
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Do report back if you do follow up on this lead, and if it goes smooth with no issues with IRAS or with accountants etc.

Roo said:
(Sovreign said they tax 10K for those services)
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That's a very high fee for SG. Are they just expensive, or is it because they need to something particular to claim offshore status? If not? What is this fee for?

And, did they say that you can't bank in SG ? That part doesn't make sense to me, as all the info regarding not banking in SG refers to SG tax resident companies.
Anyway, if this is the case, are you sure Wise is not a SG bank?

 

[daniels27]

Roo said:
@daniels27 , @JustAnotherNomad the downside compared to a US LLC is the annual cost which is from 2.5K USD upwards (Sovreign said they tax 10K for those services). A US LLC will cost based on what I found online so far
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Yes but it gives you more flexibility to keep assets in the company should you once stay somewhere for longer. CIT+dividends may be cheaper that salary as for the US LLC.

Xshore said:
That's a very high fee for SG. Are they just expensive, or is it because they need to something particular to claim offshore status? If not? What is this fee for?
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The fee is about 4k for the compliance and resident director. The rest could be avoided if you do bookkeeping and tax filing yourself.

Xshore said:
And, did they say that you can't bank in SG ? That part doesn't make sense to me, as all the info regarding not banking in SG refers to SG tax resident companies.
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If you remit money to Singapore it is taxable.

Xshore said:
Anyway, if this is the case, are you sure Wise is not a SG bank?
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Then take another EMI. Airwallex etc.

What about PayPal? Are they considered a Singaporean bank?

Last edited: Apr 17, 2024

 

[Roo]

Xshore said:
Do report back if you do follow up on this lead, and if it goes smooth with no issues with IRAS or with accountants etc.

That's a very high fee for SG. Are they just expensive, or is it because they need to something particular to claim offshore status? If not? What is this fee for?

Anyway, if this is the case, are you sure Wise is not a SG bank?
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I am asking my current providers about this, will report back if I end up going this way.
The guys said they are an international company and high quality service provider so it's a premium fee.

Wise holds SGD in Singapore accounts but I don't deal with SGD at all so I would quite confidently say no (EUR is held in belgium based on iban).

 

[Xshore]

Roo said:
I am asking my current providers about this, will report back if I end up going this way.
The guys said they are an international company and high quality service provider so it's a premium fee.

Wise holds SGD in Singapore accounts but I don't deal with SGD at all so I would quite confidently say no (EUR is held in belgium based on iban).
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I don't think the IBAN decides where the bank account is based. Check your terms of conditions. I know that in Malaysia all the currencies are held with Wise Malaysia, even though you can deposit EUR to the BE IBAN.

daniels27 said:
If you remit money to Singapore it is taxable.
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Everything I've seen about this refers to SG tax resident companies. Where does it say that it is taxable for non SG tax resident companies?

daniels27 said:
What about PayPal? Are they considered a Singaporean bank?
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I think they have a license in SG, and if not a bank then at least they're an e-money provider. So I'd assume money received to a SG paypal account is considered remitted to Singapore.

Last edited: Apr 17, 2024

 

[JustAnotherNomad]

daniels27 said:
Yes but it gives you more flexibility to keep assets in the company should you once stay somewhere for longer.
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Why? I understand a US LLC could be considered as transparent (all income taxable immediately if you are tax resident, even if there is no PE), is that what you mean?
That the SG company would be opaque, so they would have to prove PE/PoM? Though the latter probably shouldn't be hard to do if you have no ties to SG and you actually stay in a country for 183+ days in any tax year - but of course, they'd have to catch you first and most people would be flying under the radar.

daniels27 said:
CIT+dividends may be cheaper that salary as for the US LLC.
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Why would you be paying CIT? Where?

daniels27 said:
The fee is about 4k for the compliance and resident director.
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You still need a resident director? How doesn't that make the company tax resident in SG (local management)?

daniels27 said:
If you remit money to Singapore it is taxable.
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If the company is tax resident in SG, of course.
But if the company isn't tax resident in SG anyway - shouldn't it be treated like a BVI company, for instance? Why should a BVI company have to pay tax if it remits money to SG?

 

[bountymounty]

Xshore said:
Many claim that offshore income is not taxable, however very few seems to achieve that in practice.
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That is also my experience. Would like to learn how to achieve it!

 

[Roo]

bountymounty said:
That is also my experience. Would like to learn how to achieve it!
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I really tried to find something related to this on the IRAS website and couldn't, I am considering asking IRAS directly, I would assume whatever they answer is what will apply or get permitted in practice regardless of what agents claim to be possible.

 

[daniels27]

Xshore said:
Erything I've seen about this refers to SG tax resident companies. Where does it say that it is taxable for non SG tax resident companies?
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It is hybrid. Singapore companies are only taxed on income derived it remitted to Singapore. If you have neither, you are offshore. Otherwise you pay taxes only on they part.

In other words, what you are looking for cannot exists. As soon as you remit money to Singapore you become tax resident for at least that part.

Xshore said:
I think they have a license in SG, and if not a bank then at least they're an e-money provider. So I'd assume money received to a SG paypal account is considered remitted to Singapore.
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Then better use US PayPal.

JustAnotherNomad said:
Why? I understand a US LLC could be considered as transparent (all income taxable immediately if you are tax resident, even if there is no PE), is that what you mean?
That the SG company would be opaque, so they would have to prove PE/PoM? Though the latter probably shouldn't be hard to do if you have no ties to SG and you actually stay in a country for 183+ days in any tax year - but of course, they'd have to catch you first and most people would be flying under the radar.

Why would you be paying CIT? Where?
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Let's say you travel and decide to stay a year in Hong Kong. You can register your Singapore company there and pay tax on the profit. With the LLC this becomes much more troublesome. Or you can simply hire a director in St Barth's and have no issues. That's why I say that the opaque company offers you greater flexibility.

JustAnotherNomad said:
You still need a resident director? How doesn't that make the company tax resident in SG (local management)?
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Nominee director. Many countries require this even for non tax resident companies.

JustAnotherNomad said:
If the company is tax resident in SG, of course.
But if the company isn't tax resident in SG anyway - shouldn't it be treated like a BVI company, for instance? Why should a BVI company have to pay tax if it remits money to SG?
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No. A Singaporean company is taxed on money remitted to Singapore. If you have a place is effective management in a treaty country, this probably won't apply as per the treaty. A BVI company is not taxed on that unless tax resident in Singapore.

bountymounty said:
That is also my experience. Would like to learn how to achieve it!
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Call Sovereign

 

[JustAnotherNomad]

I believe what you should ask IRAS is: "What are the requirements for a company that was incorporated in Singapore not to be considered tax resident in Singapore and thus not subject to tax in Singapore, or only subject to tax from Singapore-source income?"

This is a very different question compared to asking: "What are the requirements for income of a Singapore-resident company to be considered foreign-sourced and exempt from tax in Singapore?"