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Optimal Setup for a Digital Company

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Gante

Gante

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Jan 13, 2025
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Hello,

Today, I am reaching out to ask for advice on the best setup for a company that operates exclusively through international digital sales.

We are considering Delaware as a potential jurisdiction, and I have a few questions regarding this:
  1. What documents are required to set up a company in Delaware?
  2. Which agent would you recommend to assist with the company formation process in Delaware?
  3. As a French citizen, do I have the right to establish a company in Delaware?
  4. What would the tax rate be for a company primarily selling outside the USA, operating solely through digital sales, and with no American employees?
If I have overlooked any crucial details, please feel free to let me know.

Additionally, if you have suggestions for other locations that might be a better fit, I would greatly appreciate your input.

Thank you in advance for your responses
 
Delaware is mainly aime at companies you want to‍ sell. Wyoming, New Mexico would be cheaper alternatives for your goal (most likely).

Yes. (But note that as a French resident, you have the honour⁣ to pay tax on the profit of your US company.)

Tax is the same as for︁ a company registered where you are living / managing the company from.

Wyoming, New Mexico. (There may be better ones,︃ depending on your residence.)
 
Hello,

Thank you for your response. Which agent would you recommend for setting up a‌ company in one of the states you mentioned?
 
It could‌ work. Not the best, not the worst. Fees are somewhat high and the secretary of‍ state is quite slow, but the state is well-known and trusted. Other US states like⁠ Wyoming or Florida might make more sense based on the individual case.
Nothing special.⁤ The registered agent may or may not ask for your ID. Otherwise just info about⁣ yourself, your address, name of the company.
Harvard Business Services or︀ A Registered Agent Inc. are quite good for the state. They are the most frequent/notorious︁ virtual addresses/registered agents but the pricing and setup is reasonable.
Yes, of course. Nobody will stop you from doing that.

However, keep in mind, if︄ you are resident in France, or other jurisdictions with applicable PE/CFC laws that would affect︅ the company, you will be required to pay taxes, either as a corporate, or as︆ a person with business activity.
0%. No ECI so no US tax, the LLC transparently distributes︉ to you.
Depends on your︋ residency. Can you share it here?
 
To be honest, you‌ are probably best helped with a French company (unless you are relocating elsewhere). Of course,‍ you can add a US entity, but in the long run, it will cause you⁠ nothing but troubles.
  • Banking access will be more difficult
  • Credit Card acceptance will be difficult⁤ and expensive
  • Tax problems with the French authorities in regards to the US LLC, how⁣ is it taxed etc.
And there will be 0 tax savings possible. You pretty much⁢ can only lose.

(The exception would be if you are a multi million dollar venture︀ able to set up a corporate headquarter in a low tax jurisdiction, adding a Irish︁ subsidiary solely for payment processing and banking access, etc. Then, it would make sence. But︂ I am not so sure of this is the case with you.)
 
As @daniels27 said, you will not really gain anything by registering‍ a US company while living in France, because the company will still be a tax⁠ resident of France.

When you accept relocation, you have quite a lot of options.

If you want to stay in the EU (not particularly recommended but also very understandable), maybe⁤ Cyprus or Malta to best match the current lifestyle. Hungary and Bulgaria have good tax⁣ opportunities but harder to get around without the language.

Otherwise of course a lot of⁢ LatAm - Costa Rica, Dominican Rep., Paraguay... and some Asian options too.
 
No, I don't necessarily have a preference, I'd just like a place where I can‌ work in good conditions and spend part of the year. As for my business, I‍ work in the telecoms sector.
 
Then maybe Japan, Thailand, Vietnam⁠ and the Philippines each a couple of months and then a US LLC that nobody⁤ cares and all is tax free? I think @NewHorizonsParaguay is giving out free residencies in⁣ Paraguay, while others prefer Peru. I think it is a matter of taste.
 
There are hundreds of providers, as you can see in the thread referenced above. Setting‌ up a company like that costs less than $500.

Since you're from France, you could‍ just move to the French-speaking part of Switzerland like so many others have, it comes⁠ with some benefits. Otherwise, yeah, Malta, Cyprus, Bulgaria, or Portugal are the ones we've discussed⁤ here on OCT plenty of times already if you want to stay within Europe.
 
What's the costs we are looking at when you say high⁤ ?

Others suggest New Mexico and Wyoming, running companies there costs roughly 500 - 1000$⁣ a year.
 
if I start to have some US-based customers for digital products/services, this could change things‌ at the LLC level.
 
As you’ve probably figured out, there’s no tax savings in setting up a US LLC,‌ no matter which state you choose.

You either have to move out of your home‍ country or invest some money in substance.

I read about another user here on OCT⁠ who spent 45000 dollars establishing substance for the companies he sets up around the world.⁤

Of course, this cost needs to be weighed against the potential long term savings to⁣ determine if it’s actually worth it.
 
yeah you have to leave your‍ country if you want to save taxes this way.
 
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