offshore structure for IT consultant in EU with EU clients

[blip]

This forum is great, this is my first post.

I'm looking to establish an offshore structure to bill for IT consultancy services in Europe (in my own country of residence). I don't want my name to appear anywhere on any contract towards the clients. So a nominee director is a must.

I'm thinking to have a structure as follows.

I am thinking on setting up a Seychelles holding company which in turn will own a Cyprus company.
The Cyprus company will sign any IT contract with clients in northern Europe. All invoices paid to Cyprus company's bank account.
Because the Seychelles company is owning the Cypriotic company, will I get away with 0% tax? I know that Cyprus has 12.5% corporate tax but read that you may actually decrease that significantly with a Secyhelles holding company. Don't know if this is true, if someone can confirm it would be great. But even with 12.5% tax it would be a good deal for me if nothing else is taxed.

Does the money flow from the European client to Cyprus company to Seychelles company and then I can withdraw that money with a debit card from abroad?

Does the Seychelles company need a nominee director as well?
Do I need nominee shareholder for Secyhelles company?
To open a bank account for the Cypriotic company the bank would need to know that I am the beneficial owner, right?
Is it the same to open a bank account for the Seychelles company? Do they need to know I am the beneficial owner?
Maybe it would be enough to have a real bank account for the Cypriotic company and then just a virtual bank account (something like Leupay etc.) for Seychelles?

Do I need to set up two companies for this (Seychelles and Cyprus)? Or is it enough with the one in Cyprus?

Is this a good overall setup? After having spent quite some time reading up on the forum I understand this would be the way to move forward for me. But maybe there are other countries that are better choices for my situation?

I would need this setup probably within 2-3 weeks and don't know if this is even possible to get in this time frame.

Any idea of the total cost for the 1st year?
What about cost for the following years?

Where do I go from here? Who do I contact to get this started?

Thank you for any input.

 

[negon]

Welcome aboard 🙂

Most of the questions you can find answers here on the forum already.

A Seychelles Holding company + Cyprus trading corp. works great with each other both tax vise but also in regards to privacy. Nominee director and shareholder can be appointed on both entities and you can transfer your money tax free between the entities.

I have been using these guys Gain Better Stability, Privacy, and Profitability with OffshoreCorpgroup.com as well as many other forum users as you can see.

Maybe @Admin will kick in here with more details 🙂 in the meantime take a look at the different threads and also use the search field, there is a lot of great information to be found here already 😉

 

[lostguy]

Following this conversation to get a better understanding! I already have a Seychelles company. Do you think I could use it in the structure as OP want to setup?

 

[maxmoney]

blip said:
Does the money flow from the European client to Cyprus company to Seychelles company and then I can withdraw that money with a debit card from abroad?
Click to expand...

That's how it works for me with just only a Seychelles company so far. I plan to get a Cyprus (wanted a BVI corp first) company for trading and let the Seychelles play a role in the background so I can take money out with a debit card.

 

[blip]

auric said:
Welcome aboard 🙂

Most of the questions you can find answers here on the forum already.

A Seychelles Holding company + Cyprus trading corp. works great with each other both tax vise but also in regards to privacy. Nominee director and shareholder can be appointed on both entities and you can transfer your money tax free between the entities.

I have been using these guys Gain Better Stability, Privacy, and Profitability with OffshoreCorpgroup.com as well as many other forum users as you can see.

Maybe @Admin will kick in here with more details 🙂 in the meantime take a look at the different threads and also use the search field, there is a lot of great information to be found here already 😉
Click to expand...

Thanks auric. Yes this forum is a wealth of information and I'm trying to catch up.
I saw OffShoreCorpgroup was mentioned on more places in this forum. I just wanted to have a better clue of what I need before contacting them.

In a setup like I described (Secyhelles holding + Cyprus service company) would my name ever have to be disclosed to anyone even if I have nominees? And if so, at what level? I'm thinking specifically on the situation when I have to open the bank accounts for the companies and the banks want to know who the ultimate beneficial owner is.

1. Seychelles company opens bank account. I assume the bank needs MY details as to know who is behind everything?

2. Cyprus company opens bank account. The bank still wants MY details? Or the details of the Seychelles company (the holding company)?

Thankful if anyone could shed some light on this. 🙂

 

[JohnLocke]

blip said:
1. Seychelles company opens bank account. I assume the bank needs MY details as to know who is behind everything?
Click to expand...

Yes they will require all information from you i.e. passport, utility bill, CV, business description and of course incorporation documents.

blip said:
2. Cyprus company opens bank account. The bank still wants MY details? Or the details of the Seychelles company (the holding company)?
Click to expand...

Usually they only need the documents for the Cyprus company and YOU - but depending on the activity etc. they will require the incorporation documents for the Seychelles company too. However, you can always start with the Cyprus company first, open the account once opened then proceed with the Seychelles holding corp.

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[orangeye]

blip said:
Does the Seychelles company need a nominee director as well?
Click to expand...

There is no need for a nominee in your setup. Unless you want to hide your name from the contractor, business partners or customers then it would be waste of money. You could appoint a nominee director (+shareholder) to the Seychelles corp and insert the Seychelles corp as director and shareholder in the Cyprus company so you will safe some money.

 

[pesto]

You want to consider if a real bank account is needed for what you try to achieve. Anonymity and real banking does not go hand in hand. I would setup Cyprus corp. 100% anonymous and use WorldCore, AdvanceCash or similar service to cash out my money or find some middle man that can transfer money for me to my own account if that is what you require.

 

[blip]

Admin said:
you can always start with the Cyprus company first, open the account once opened then proceed with the Seychelles holding corp.
Click to expand...

Thanks for chiming in Admin.

Honestly I thought that this way (first Cyprus, then Seychelles) would make it harder and more cumbersome.
I'm thinking about the process (=cost money, takes time) of changing nominees in the Cyprus company. The nominees would be changed to be the Seychelles company once it is founded and "takes over" the Cyprus company.
But maybe you meant to say that I could start with Cyprus and then later down the road I could plug in a Seychelles company IF I need it (maybe I would not need it)?

 

[blip]

orangeye said:
There is no need for a nominee in your setup. Unless you want to hide your name from the contractor, business partners or customers then it would be waste of money. You could appoint a nominee director (+shareholder) to the Seychelles corp and insert the Seychelles corp as director and shareholder in the Cyprus company so you will safe some money.
Click to expand...

Thanks orangeye.

My business partners would know my name - I'm the person doing the actual work in tandem with the customer so it is hard to stay anonymous when sitting in the customer's premises. 🙂
But I don't want them to know that the (Cypriotic) company doing the actual invoicing is controlled or ultimately owned by me.
The Cypriotic company signs the service contract with the customer (I will not sign anything, a director will have to sign). I would just be a "normal employee" not knowing any specifics about the management of the company. 🙂

I'm also starting to think that a Seychelles company might be overkill for me altogether (at least for now).

Basically what I want to accomplish is:
1. being able to invoice EU customer from Cyprus company
2. no one should know that I am OWNING the Cyprus company

That's it.

At some point in time I want to withdraw that money. Not highest priority right now, I can have the money accumulate on the company account (wherever that may be) for half a year or a year or so.

So then as I see it, Seychelles holding company would give me higher asset protection but not much more with regards to anonymity. I would have enough anonymity by having nominees for the Cyprus company, my name will not show up anyway.

pesto said:
You want to consider if a real bank account is needed for what you try to achieve. Anonymity and real banking does not go hand in hand. I would setup Cyprus corp. 100% anonymous and use WorldCore, AdvanceCash or similar service to cash out my money or find some middle man that can transfer money for me to my own account if that is what you require.
Click to expand...

I've been looking at WorldCore and it looks very nice but don't feel super confident about having too large sums in those accounts. :/

It is important for my customer to be able to do a normal bank wire transfer (SWIFT, IBAN) when paying my invoices and WorldCore does support this (according to some threads I saw here at the forum). One caveat though is that I will not get my own IBAN (customer will wire to a shared IBAN and put down the account number as a message to be able to reach my account).

 

[cutmetwo]

blip said:
But I don't want them to know that the (Cypriotic) company doing the actual invoicing is controlled or ultimately owned by me.
The Cypriotic company signs the service contract with the customer (I will not sign anything, a director will have to sign). I would just be a "normal employee" not knowing any specifics about the management of the company. 🙂
Click to expand...

Maybe I'm stupid but can't it be done using nominee director and shareholder? So you only need to get an employee contract from the company which the "director" will give you to sign?

 

[blip]

cutmetwo said:
Maybe I'm stupid but can't it be done using nominee director and shareholder? So you only need to get an employee contract from the company which the "director" will give you to sign?
Click to expand...

Yes I have realized that nominee director + shareholder would do the trick. I just wasn't sure that would be enough when I started the thread.

 

[blip]

Does anyone know if I can use a Cyprus non-resident company to invoice my EU customers?
I mean, I know it can be done but am I losing out on something compared to having a resident Cyprus company?

I know that resident company can utilize double tax agreements with other countries (e.g. Seychelles) but since a non-resident company does not pay any tax at all I really don't see the point having a resident company. Am I missing something obvious here?

Worth mentioning: the Cyprus company will not be used for any other activities apart from invoicing my EU customer(s).

 

[negon]

You can't register the non resident company for VAT! Some companies in the EU will require you to be able to do that. The companies in the EU are they all online business?

 

[blip]

auric said:
You can't register the non resident company for VAT! Some companies in the EU will require you to be able to do that. The companies in the EU are they all online business?
Click to expand...

None of my customers are online businesses. They are ordinary companies in need of someone developing their IT systems. We're talking about companies like Siemens, Vodafone, European banks etc.

I have a middle man (broker) in between myself and the end customer so I will be invoicing the broker (in my home country) and they in turn will invoice the end customer. So maybe it does not even matter who the end customer is.

I'm not sure whether the broker will require that the Cyprus company be VAT registered. Maybe its better to have it VAT registered just to not draw any attention when sending the invoices?!

 

[JohnLocke]

If you broker don't care you don't need to register the company for VAT! If you sold your products / services directly to these companies I would say they will require you to be registered for VAT.

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[FullDISK]

Why not buy a Scotland Company? If you operate outside from Scotland, the fees are 0%. The same privacy and is a EU Company.

 

[blip]

FullDISK said:
Why not buy a Scotland Company? If you operate outside from Scotland, the fees are 0%. The same privacy and is a EU Company.
Click to expand...

I wasn't even aware of this.

But what about anonymity? Can you appoint nominees for both director and shareholder?
Could you move funds from a Scotland company to its holding company at 0% tax? Similar to moving from Cyprus to Seychelles?

Who can help incorporate and at what price?

 

[blip]

Admin said:
If you broker don't care you don't need to register the company for VAT! If you sold your products / services directly to these companies I would say they will require you to be registered for VAT.
Click to expand...

The problem is I don't know whether the broker will accept it yet. :/
But why wouldn't they? What is the difference for them? I mean, it will not cost them anything extra just because Cyprus company is not VAT registered. Or it just makes all the alarms ring loud at their finance department when an invoice comes from a non-VAT registered company?

Do you know if you can change a Cyprus company from non-resident to resident and vice versa at a later time?

 

[FullDISK]

What I know is:


Company type
Limited Partnership (LP)


Directors/Officers
Scotland LP companies require a minimum of 2 Partners, who may be natural persons or corporate bodies from any legal jurisdiction.
Each Scottish LP company must file a register of its Partners with the Register of Enterprises of Scotland.


Shareholders
The capital of the company is divided between its Partners.


Secretary
There is no statutory requirement for a Company Secretary to be appointed.

Authorised share capital
Standard authorised capital - GBP 1000.
Minimum capital, which must be paid on incorporation - 2 GBP.


Company Names
The name of a Scotland LP company must end with the suffix ''LP''. Company names containing restricted words such as ''Bank'', ''Insurance'', ''Trust'', etc. will not be permitted unless an appropriate national operating licence has been obtained by the company.


Beneficial Ownership information
Information with regard to ultimate beneficial ownership must be disclosed to the Registered Agent of the company and is held by the agent on a confidential basis.


Filing of Annual Return
An Annual Return must be submitted every 12 months after the date of registration.


Filing of Financial Statements
Every Scottish LP must keep appropriate accounting records, and prepare a Financial Statement annually. Also, Tax Declaration (form SA 800) must be submitted to the UK Inland Revenue annually.


Corporate Taxation
LP companies that do not carry on any commercial operations in UK; do not derive any income from UK sources, and are managed and controlled by Members who are not UK residents, are exempt from U.K. corporate tax.


Tax Treaties
LP companies that do not carry on any commercial operations in UK; do not derive any income from UK sources, and are managed and controlled by Members who are not UK residents, are not regarded as resident for tax purposes in UK, and therefore are not entitled to take advantage of international Double Tax treaties concluded by the UK with other countries.