Setup for Crypto and Stock trading

[Dom pedro]

Hello guys. I would be glad if someone helps me in choosing a jurisdiction.

1) The main purpose is to avoid capital gain tax and being able to trade crypto/stocks without worrying about accounting.
2) I am based in Brazil. I am not liable to taxes from the profits generated by the Offshore Company, I would only pay tax if I pay myself dividends.
3) I don't need to cash out for the next few years. I plan to first accumulate wealth using this structure and in the future moving to a country that don't tax foreign dividends (such as Uruguay)
4) Being able to create an account in FTX is very important, and they don't allow US jurisdictions. Having a IBKR account is nice but not a necessity.
5) I don't need anonymity. The source of the funds is legit.
6) I would like to pay no more than $2.5k yearly in maintenance costs.
7) Although it would be very nice to have a Crypto->Fiat path, this is not required as long as I have a Crypto->FTX and Fiat(personal)->Fiat(corporate) path.
8) I plan from time to time (like once or twice a year) move crypto/fiat to my offshore company in order to invest.

A setup that seems to fit these requirements is a BVI company + EMI as it seems to work with both FTX and IBKR. I have read recently in this forum however that someone with BVI was rejected in IBKR.
It also seems that I can also use a UK LLP, as I would not need accounting or pay taxes due to being a foreigner and it being a small company (less than $10M worth)
I was also considering a Delaware LLC. It is cheap and I would not face problems with EMIs and Brokers. I would not be able to trade on FTX legally though. But I could create an account with KYC level 1, no proof of identification needed, and the 9000 USD daily withdraw limit is enough for me. But if they ask for proof of identity in the future I may have my funds blocked.

I would be glad to hear other suggestions.

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[CaptK]

I believe the LLP route is the best one for you.

 

[Martin Everson]

Dom pedro said:
I was also considering a Delaware LLC. It is cheap and I would not face problems with EMIs and Brokers.
Click to expand...

Which EMI works with a Brazil resident with a Delaware LLC out of interest?

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[Dom pedro]

CaptK said:
I believe the LLP route is the best one for you.
Click to expand...

Do you have a recommended firm for LLP formation? Also, I don't need to worry about accounting, right? The UK option attracted me a lot. But there is not a lot of info and services out there compared to US.

Martin Everson said:
Which EMI works with a Brazil resident with a Delaware LLC out of interest?
Click to expand...

I just assumed I would be able to get a Mercury or Wise account(no debit card for wise). I heard that for Mercury they can send you a debit card almost anywhere in the world without even needing a forwarding service. I just sent them an email asking them if they would accept me. In the last case scenario I could try traveling to US in order to open a bank account personally.


By the way, I was planning for a single offshore that would fit all my needs. But now I am considering having a LLC for banking and stock investing and another offshore in a lower-quality country for crypto might not be a bad idea.

 

[Tr0nad0r]

Let us know what Wise says about the stock trading company, for the crypto trading company is definitely a big NO.

 

[CaptK]

Dom pedro said:
Do you have a recommended firm for LLP formation? Also, I don't need to worry about accounting, right? The UK option attracted me a lot. But there is not a lot of info and services out there compared to US.
Click to expand...

Happy to help, details below.

 

[Martin Everson]

Dom pedro said:
I just assumed I would be able to get a Mercury or Wise account(no debit card for wise). I heard that for Mercury they can send you a debit card almost anywhere in the world without even needing a forwarding service. I just sent them an email asking them if they would accept me. In the last case scenario I could try traveling to US in order to open a bank account personally.
Click to expand...

I don't know about Mercury but let us know how far you get with Wise as that seems impossible to me. But if you can open at least 3 good accounts for your setup then proceed. Otherwise don't waste your time as if Mercury fires you then you will be back on here asking for help which won't come.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[Dom pedro]

Martin Everson said:
I don't know about Mercury but let us know how far you get with Wise as that seems impossible to me. But if you can open at least 3 good accounts for your setup then proceed. Otherwise don't waste your time as if Mercury fires you then you will be back on here asking for help which won't come.
Click to expand...

Is wise rejecting your applications? Are they for companies located in US? Or companies in the Caribbean?

guilleiguaran said:
Let us know what Wise says about the stock trading company, for the crypto trading company is definitely a big NO.
Click to expand...

I see. Better to use them only for sending/receiving from IBKR. For the Crypto<->Fiat I could use an intermediate EMI.

 

[Martin Everson]

Dom pedro said:
I see. Better to use them only for sending/receiving from IBKR. For the Crypto<->Fiat I could use an intermediate EMI.
Click to expand...

You want to read carefully Wise's Acceptable use policy for Brazil.

https://wise.com/br/legal/acceptable-use-policy
See section 1.2.2 c 1. This is a broad term they use as a catch all related to crypto.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[Dom pedro]

Martin Everson said:
You want to read carefully Wise's Acceptable use policy for Brazil.

https://wise.com/br/legal/acceptable-use-policy
See section 1.2.2 c 1. This is a broad term they use as a catch all related to crypto.
Click to expand...

Thank you for your response. Yeah, it seems that I should not use Wise for anything related to Crypto. Specially if I haven't secured other bank accounts.
I am considering the following:
Opening a Delaware LLC. While a wait for the EIN (should take many months) I open an account with IBKR. When EIN arrives I try to open accounts in the many available EINs. In 2022 I will try traveling to US in order to open a bank account in a high street bank.

 

[JohnLocke]

Does someone know if Mercury is crypto friendly ?

I contacted them some time ago, they are very responsive and detailed in their replies, I just forgot to ask about crypto.

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[brypto]

Hi everybody. I am in a similar situation also based in south america.
Take in consideration that a lot of US brokers need to be funded via a wire transfer from an account with the same beneficiary name as the brokerage account. Many EMIs use third party or they own bank accounts to do the wires and the broker may reject them.
If you trade on FTX you know they offer stocks too, not a lot, but all "the hot ones" and you can convert the tokenized one to the real one (in partnership with a german stock broker).
If you don't trade futures, you can open an FTX US account to buy and sell spot with a DE llc. Same with binance us
I wrote mercury last year and they told me they dont like crypto because they dont want problems with their banking partner.
In my case I want to open an account in tastyworks (wall street options) and deribit (bitcoin and eth options) and in my particular case I think I need two different entities: A us based company with a us bank account to trade options on WS and a friendly jurisdiction entity without bank account for crypto.

 

[Dom pedro]

brypto said:
Hi everybody. I am in a similar situation also based in south america.
Take in consideration that a lot of US brokers need to be funded via a wire transfer from an account with the same beneficiary name as the brokerage account. Many EMIs use third party or they own bank accounts to do the wires and the broker may reject them.
If you trade on FTX you know they offer stocks too, not a lot, but all "the hot ones" and you can convert the tokenized one to the real one (in partnership with a german stock broker).
If you don't trade futures, you can open an FTX US account to buy and sell spot with a DE llc. Same with binance us
I wrote mercury last year and they told me they dont like crypto because they dont want problems with their banking partner.
In my case I want to open an account in tastyworks (wall street options) and deribit (bitcoin and eth options) and in my particular case I think I need two different entities: A us based company with a us bank account to trade options on WS and a friendly jurisdiction entity without bank account for crypto.
Click to expand...

Wow. We basically are in almost the same situation.
I am also considering right now forming 2 different companies.
I have used Wise to fund my IBKR personal account, so I believe that this would also work with a business account. I am considering trying a Wyoming LLC + EMI for that.
For the crypto trading part I am thinking of just getting the cheapest option available without bank account (from my research it's seychelles for about $450) and create binance/FTX accounts there. Maybe I could do this first and trade stock futures on FTX for now. But the only problem is that I am kinda afraid I would not pass their KYC for stocks.

 

[yeongsu]

brypto said:
Take in consideration that a lot of US brokers need to be funded via a wire transfer from an account with the same beneficiary name as the brokerage account. Many EMIs use third party or they own bank accounts to do the wires and the broker may reject them.
Click to expand...

Dom pedro said:
I have used Wise to fund my IBKR personal account, so I believe that this would also work with a business account. I am considering trying a Wyoming LLC + EMI for that.
Click to expand...

Hello, please tell me your views about Interactive Brokers for option trading.
I'm planning to open a UK LLC to trade stock options in IBKR as UK has some tax benefits for foreign-owned llc/llp. And withdraw the profits as salary or using invoices (in case salary route causes any kind of issues).
Does Wyoming LLC has more benefits over UK LLC in terms of getting an account on IBKR and a bank that will not be blocked by IBKR?
I've seen some threads where people mentioned that IBKR blocked transactions from/to their EMI accounts.

 

[CaptK]

Ibkr USA and IBKR rest of the world are 2 different entities. The US version has the full effect of the US laws and regulations and there maybe some you can't buy.
Also it is taxed different.

 

[aplnx]

Dom pedro said:
Hello guys. I would be glad if someone helps me in choosing a jurisdiction.

1) The main purpose is to avoid capital gain tax and being able to trade crypto/stocks without worrying about accounting.
2) I am based in Brazil. I am not liable to taxes from the profits generated by the Offshore Company, I would only pay tax if I pay myself dividends.
3) I don't need to cash out for the next few years. I plan to first accumulate wealth using this structure and in the future moving to a country that don't tax foreign dividends (such as Uruguay)
4) Being able to create an account in FTX is very important, and they don't allow US jurisdictions. Having a IBKR account is nice but not a necessity.
5) I don't need anonymity. The source of the funds is legit.
6) I would like to pay no more than $2.5k yearly in maintenance costs.
7) Although it would be very nice to have a Crypto->Fiat path, this is not required as long as I have a Crypto->FTX and Fiat(personal)->Fiat(corporate) path.
8) I plan from time to time (like once or twice a year) move crypto/fiat to my offshore company in order to invest.

A setup that seems to fit these requirements is a BVI company + EMI as it seems to work with both FTX and IBKR. I have read recently in this forum however that someone with BVI was rejected in IBKR.
It also seems that I can also use a UK LLP, as I would not need accounting or pay taxes due to being a foreigner and it being a small company (less than $10M worth)
I was also considering a Delaware LLC. It is cheap and I would not face problems with EMIs and Brokers. I would not be able to trade on FTX legally though. But I could create an account with KYC level 1, no proof of identification needed, and the 9000 USD daily withdraw limit is enough for me. But if they ask for proof of identity in the future I may have my funds blocked.

I would be glad to hear other suggestions.
Click to expand...

The first bullet you describe here is the gold definition of what everybody is looking for.

Thanks for your comments!

 

[brypto]

offshoreyeongsu said:
Hello, please tell me your views about Interactive Brokers for option trading.
I'm planning to open a UK LLC to trade stock options in IBKR as UK has some tax benefits for foreign-owned llc/llp. And withdraw the profits as salary or using invoices (in case salary route causes any kind of issues).
Does Wyoming LLC has more benefits over UK LLC in terms of getting an account on IBKR and a bank that will not be blocked by IBKR?
I've seen some threads where people mentioned that IBKR blocked transactions from/to their EMI accounts.
Click to expand...

I never used IBKR for trading options but it looks very similar to thinkorswim from TD ameritrade, maybe "the standard". I don't know about the fees. I really like Tastyworks, the broker mainly focused on options trading and founded by the guys who made thinkorswim.

Dom pedro said:
Wow. We basically are in almost the same situation.
I am also considering right now forming 2 different companies.
I have used Wise to fund my IBKR personal account, so I believe that this would also work with a business account. I am considering trying a Wyoming LLC + EMI for that.
For the crypto trading part I am thinking of just getting the cheapest option available without bank account (from my research it's seychelles for about $450) and create binance/FTX accounts there. Maybe I could do this first and trade stock futures on FTX for now. But the only problem is that I am kinda afraid I would not pass their KYC for stocks.
Click to expand...

Indeed! I'm glad I've found someone trying to solve the same problem. Seychelles seems to be one of the cheapest and hassle free. Someone here recommended me Cook Islands a few months ago but honestly that was the first time I've heard about Cook Islands. I am not sure if FTX let corporate accounts trade stocks.
I think the best solution is to go through the path of least resistance as the US based brokers are more confortable with local entities and crypto exchanges are more confortable with not-even-close-to-US entities.

 

[upsdiditagain]

Trying to do the same thing here... Would you have any issues between binance and Seychelles?

 

[Dom pedro]

upsdiditagain said:
Trying to do the same thing here... Would you have any issues between binance and Seychelles?
Click to expand...

That is the question that everyone here is asking and nobody could answer. Theoretically they could accept a company from Seychelles. But we don't know until someone tries. One difference between the binance and FTX applications are that Binance expects much more documents regarding the director/shareholder/trader. FTX is more simple but it requests a Proof of Address, which sucks. For a company in Seychelles or BVI that doesn't have a bank account we would need something like a phone bill as proof.

 

[uplana]

Did you check with @CaptK second post suggestion ?

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