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Hong Kong Ltd VS US Ltd VS UK Ltd

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banafinfodafuggiano

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Jun 18, 2020
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Alright fellas, I'm about to open a HK Ltd since the income my business receive is 100% offshore.
My HK accountant say there should be no problem getting the Tax exemption, and it's costing me approx 750 USD a month all included (auditing, book keeping, etc).
This is twice cheaper than just my accounting in Canada, plus there would be no taxes.

I also heard US LLCs and UK Ltds can be tax free, however, it looks like there are zero banking opportunities for non-residents,

can someone confirm all my statements above are true?

Also, can you purchase non-business related assets with the HK company such as vehicles, cars, houses, gold, crypto , etc or it's not possible?
 
US and UK are tax transparent. HK is opaque. But the main question here will‌ be: where is your company effectively managed from? If you live in Canada and manage‍ the company from Canada, it is taxable in Canada.
 
750 usd a month seemed very expensive? Is that including the free for the one‌ time offshore tax status handling?

UK Ltd are not tax transparent, maybe you're thinking of llp?
You can, but then it's a⁤ business asset.
 
A UK LTD is not tax transparent, it's just that one can easily transfer its‌ tax residence elsewhere, which may or may not have the same effect in practice.
 
Yes, sorry. UK LTD is not tax transparent. Also the US LLC can be set‌ up opaque.

Nevertheless, you have the problem with the place of effective management and your‍ opaque company may (will) then be taxed in Canada.

Buying assets with the company is⁠ always possible. If you buy them for investment, there is no issue with it as⁤ long as you don't use it personally in any way. If you buy them to⁣ use. most likely, you then have to pay tax on the benefits of a free⁢ rental car in Canada as salary etc.

Also note that dividends from your company will︀ be most likely be taxable in your country of residence (check the law).
 
I wouldn't‍ say there are ZERO banking opportunities for non residents, especially with US LLC.

The point⁠ here is you overlooked to tell who will be running the business and where will⁤ you be tax resident.
 
There are enough. Even more if you buy Gold Mentor‍ and check there.

Come on. We all know him. He is paying taxes in Canada and does not want⁤ to pay them.
 
Bananafudgio is a local celebrity here.‍

Given the previously stated size of your business,︀ 750 USD/month for an all inclusive package is a pretty good deal in Hong Kong.︁

Yes, they︃ can be tax free under US and UK law. Both are taxable in Canada, though.︄

Yes, but it becomes a taxable benefit if it's not actually a valid, genuine, bonafide company︆ expense. Hong Kong is relaxed about a lot of things. Fraud is not one of︇ them.

So the answer is probably no in your case.
 
I will soon be a resident of a 0% Tax country /︂ or a country that doesn't tax foreign dividends. I'm already out of Canada. Unfortunately my︃ ecom stores payment gateways are only compatible with HK companies, Ireland, Canada, etc... Neither US︄ LLCs for non residents and neither UAE companies, but I can be a tax resident︅ of the UAE for example and run a HK company which doesn't tax dividends. It's︆ a decent set up the only problem is that everything is a bit vague with︇ Hong Kong accountants in terms of fees. 750 USD a month includes everything yes, of︈ course there will be extra payments eventually but it's half of what I paid in︉ Canada to remain compliant with my Taxes (insane).

Any name other than Mercury? What other EMIs or⁤ banks allow non residents to open business accounts for US LLCs? Also I heard Stripe⁣ shuts down many accounts...
 
If you go there in person you can open Wells‍ Fargo and others quite easily.
 
For non resident, no they don't. and relying on one bank only is a bad choice.‌ I need at least 5x EMIs for each corporate entity.

Even tho I'm not a resident of the US?
 
By doing so your HK‍ company will become taxable in UAE and if you say to UAE "hey i'm⁠ only a passive investor here because the business is run from HK" then you'll⁤ pay taxes in HK because income will be local sourced.

To be tax exempt in⁣ HK work needs to be performed outside HK.

Unless you become HK tax resident and⁢ live like a nomad by constantly moving so that you'll never become tax resident in︀ any outher country, you'll pay taxes somewhere.
 
There is a whole thread about that,︄ someone tried to open accounts for his US LLC at 18 EMIs: I tried opening︅ a US business account in 18 EMIs, here's the result

Basically I think the conclusion︆ was that the following non-US EMIs work: Airwallex, Zen, Wise, Verifo, and depending on your︇ place of residence Revolut.

And then there are many US banks and EMIs that accept︈ non-residents, the most popular being Mercury and Relay.

Finally, there are EMIs specialised in accepting︉ businesses that dont get accepted elsewhere, but they unsurprisingly charge much higher fees.
 
What a fail that guy,︀ he literally couldn't get more than 2-3 EMIs for his US LLC

I guess Hong︁ Kong is still the number one choice. UAE would be first but the multi currency︂ bank accounts available and payment gateways are very limited.

My customers are from outside the︃ USA but I have 1-2 clients each year who pay me $70K grand in profit︄ each and that live in the USA, I guess this will cause Taxation issues if︅ running these payments through a US LLC?
 
If you are a real Canadian, you may want to invest some money into a‌ TN visa and get a SSN. It will open many banking doors to you and‍ your company in the US.
 
Yes, they didn't even ask where I live, just the company.
A US⁤ LLC is disregarded by default, meaning you pay the same taxes as if you didn't⁣ sell through the LLC.
 
Come on, be respectful to him. It is‍ not his fault, it is the regulation which was set up because of idiots who⁠ scammed and cheated earlier.

For services? No, it won't trigger any tax︀ issues. For products, there are debates but I would not worry.

Yes. It is︂ US, they normally do not ask. But do you have a SSN? If you do︃ not have a SSN, many banks may be less inclined to open an account for︄ your company. Once you have a SSN, most banks just consider you resident and all︅ issues are solved.
 
Yes, I've opened a Delaware⁠ corporate Wells Fargo account personally, as a non-US resident, in the last year.
 
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