USA LLC vs Armenia LLC for a EU resident
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I'm running Armenian LLC right now. Your business can't have any expenses outside Armenia, otherwise you will have to pay 23% WHT on all outgoing payments. Other than this, you can apply for IT company status and pay no corporate taxes, just dividend tax 5% or so. It seems that you dont have to pay VAT for export of services (which can be your business model if I understood right). But IT status is not for everyone,︀ you probably need to develop your own software
Setup can be done remotely but its︁ very difficult to get bank account without personal visit. For card acquiring you will have︂ to either use 2checkout and pay extremely high fees or you have to apply for︃ merchant account in any of Armenian banks. For card processing you may need to have︄ a real office address in Armenia where bank managers can go and visit.
It is︅ preferrable that you become resident in Armenia. For that you only need to have a︆ real business activity with real clients to show + 2k EUR or so for residency︇ processing.
Setup can be done remotely but its︁ very difficult to get bank account without personal visit. For card acquiring you will have︂ to either use 2checkout and pay extremely high fees or you have to apply for︃ merchant account in any of Armenian banks. For card processing you may need to have︄ a real office address in Armenia where bank managers can go and visit.
It is︅ preferrable that you become resident in Armenia. For that you only need to have a︆ real business activity with real clients to show + 2k EUR or so for residency︇ processing.
Thank you @avalanche for quite detailed answer. About that:
- Armenian company cannot have euro account at any EMI like Transferwise, Revolut?
- Imposible to be resident in Armenia, because for European citizens (like France, Spain, Portugal...) it's not possible second residence in Armenia
- So only being a IT company in Armenia will be the best way to have only a 5% tax on dividend. I think good combination can be have a personal non-resident account at an Armenian Bank and pay yourself the dividends from the company to you personal account in there with the 5% tax. Is that right?
- You can invoice european/us citizens with the IT company without problems?
- Will Armenia o armenian bank︀ report something to your own country?
- Your personal data is accessible from companies register︁ of Armenia or similar? In Estonia, for example, is public...
- Being an IT company︂ is enough to build an online guide in several languages or develop Joomla/Wordpress websites?
Many thanks in advance for your help on that
- Armenian company cannot have euro account at any EMI like Transferwise, Revolut?
- Imposible to be resident in Armenia, because for European citizens (like France, Spain, Portugal...) it's not possible second residence in Armenia
- So only being a IT company in Armenia will be the best way to have only a 5% tax on dividend. I think good combination can be have a personal non-resident account at an Armenian Bank and pay yourself the dividends from the company to you personal account in there with the 5% tax. Is that right?
- You can invoice european/us citizens with the IT company without problems?
- Will Armenia o armenian bank︀ report something to your own country?
- Your personal data is accessible from companies register︁ of Armenia or similar? In Estonia, for example, is public...
- Being an IT company︂ is enough to build an online guide in several languages or develop Joomla/Wordpress websites?
Many thanks in advance for your help on that
No, most EMIs will not service you with Armenian company. You have to use local banks (which are very good but need some extra care)
Thats weird, I didnt know. You will need residence permit at least (no need for tax residency) to maintain Armenian company. That is the most optimal︀ way. Banks dont like random people who do all things totally remotely.
Its possible yes. This money can be transferred anywhere else afterwards.
Easily. We︆ are working only with EU clients right now + clients from Middle East are just︇ fine. Get paid in USD, EUR, CHF or whatever currency you like
I dont know. From what I understand, they dont do reporting even to their own government︈ lol. Unless Armenian police has court order to access your bank account, there is bank︉ secrecy in here.
No, even banks︋ need your written permission to process your company data before opening an account. If I︌ understood right, you need to be authorized to get such information from the government registry.︍ No public data so far (but still be careful, I dont know all the details)︎
From what I know, you need to either sell materials for education in IT fields OR you can develop and sell software licenses. Developing Joomla/Wordpress websites will be good enough for applying.
Note: if you register a normal company stating that it works in IT but you do not apply for this license within several months, you may forever lose the chance to apply for the license on a personal level. Open company and apply for this license immediately, do not wait (it was my mistake lol)︀
Thats weird, I didnt know. You will need residence permit at least (no need for tax residency) to maintain Armenian company. That is the most optimal︀ way. Banks dont like random people who do all things totally remotely.
Its possible yes. This money can be transferred anywhere else afterwards.
Easily. We︆ are working only with EU clients right now + clients from Middle East are just︇ fine. Get paid in USD, EUR, CHF or whatever currency you like
I dont know. From what I understand, they dont do reporting even to their own government︈ lol. Unless Armenian police has court order to access your bank account, there is bank︉ secrecy in here.
No, even banks︋ need your written permission to process your company data before opening an account. If I︌ understood right, you need to be authorized to get such information from the government registry.︍ No public data so far (but still be careful, I dont know all the details)︎
From what I know, you need to either sell materials for education in IT fields OR you can develop and sell software licenses. Developing Joomla/Wordpress websites will be good enough for applying.
Note: if you register a normal company stating that it works in IT but you do not apply for this license within several months, you may forever lose the chance to apply for the license on a personal level. Open company and apply for this license immediately, do not wait (it was my mistake lol)︀
Hello again @avalanche Many thanks for all the provided details. About all that you posted, only 2 doubts:
ABOUT "Easily. We are working only with EU clients right now + clients from Middle East are just fine. Get paid in USD, EUR, CHF or whatever currency you like"
- The armenian banks let you have account in EUR, USD and CHF with no problem? They don't use intermediate banks or similar to let the money enter the account? (I think this could be very expensive in that way).
- Banks there provide your company with merchant account to integrate to your website and checkout your︀ clients directly in EUR or USD? (instead of AMD)
ABOUT "From what I know, you︁ need to either sell materials for education in IT fields OR you can develop and︂ sell software licenses"
- That license is easy to apply and cost-free?
- What do︃ you think about AmeriaBank to manage merchant account for a company?
Many thanks mate!
ABOUT "Easily. We are working only with EU clients right now + clients from Middle East are just fine. Get paid in USD, EUR, CHF or whatever currency you like"
- The armenian banks let you have account in EUR, USD and CHF with no problem? They don't use intermediate banks or similar to let the money enter the account? (I think this could be very expensive in that way).
- Banks there provide your company with merchant account to integrate to your website and checkout your︀ clients directly in EUR or USD? (instead of AMD)
ABOUT "From what I know, you︁ need to either sell materials for education in IT fields OR you can develop and︂ sell software licenses"
- That license is easy to apply and cost-free?
- What do︃ you think about AmeriaBank to manage merchant account for a company?
Many thanks mate!
There is no problem whatsoever but of course they use intermediary banks.︀ We even use merchant account services with below 3% card processing fee (can process payments︁ in EUR). We dont pay anything for receiving money via wire transfer. EUR arrives within︂ 1 working day. CHF is very expensive though when you exchange it to something else︃ or move it around.
It costs around 10-20 EUR to send outgoing wire transfer in︄ EUR (depending on commission setting BEN, OUR, OUR-OUR). Transfers are approved quickly and without any︅ issues.
EUR, USD and AMD are all supported without any problem. We are processing︇ over 30k EUR/mo without any questions whatsoever. Just dont fuckup with chargebacks and have legit︈ business with full transparency and solid website. The only drawback, you will have to develop︉ software for integrating their API gateway. Most of all, dont do shady of fishy activity︊ and stay compliant
It costs something but︌ Im thinking budget around 2k EUR for setup of license and LLC with bank account︍ should be enough. Might take around 1-2 months to get license, bank takes usually 3-7︎ working days.
Its one of the most scrutinizing and strictest banks over here. They will ask you for details more than any other banks. But once you get an account with them, you can easily apply for any other bank and tell them you already have Ameria. They think like "oh these guys approved him, so he must be legit".
Almost any bank in Armenia has merchant account services. They all connect to ArmenianCard (ArCa) processing network which is centralized Visa/Mastercard gateway. Basically ArCa (central bank) is giving merchant services to banks and banks sell access to businesses
It costs around 10-20 EUR to send outgoing wire transfer in︄ EUR (depending on commission setting BEN, OUR, OUR-OUR). Transfers are approved quickly and without any︅ issues.
EUR, USD and AMD are all supported without any problem. We are processing︇ over 30k EUR/mo without any questions whatsoever. Just dont fuckup with chargebacks and have legit︈ business with full transparency and solid website. The only drawback, you will have to develop︉ software for integrating their API gateway. Most of all, dont do shady of fishy activity︊ and stay compliant
It costs something but︌ Im thinking budget around 2k EUR for setup of license and LLC with bank account︍ should be enough. Might take around 1-2 months to get license, bank takes usually 3-7︎ working days.
Its one of the most scrutinizing and strictest banks over here. They will ask you for details more than any other banks. But once you get an account with them, you can easily apply for any other bank and tell them you already have Ameria. They think like "oh these guys approved him, so he must be legit".
Almost any bank in Armenia has merchant account services. They all connect to ArmenianCard (ArCa) processing network which is centralized Visa/Mastercard gateway. Basically ArCa (central bank) is giving merchant services to banks and banks sell access to businesses
This sounds very interesting. Avalanche, do you have any recommendations for company formation service providers for Armenian LLC?
https://www.ibfd.org/Consultancy-Research/Tax-Treatment-Foreign-Entities-Germany-and-Spain
"Tax law often contains rules about how certain domestic entities are taxed – either︃ as a separate legal entity or as fiscally transparent. Under the former approach, the entity︄ itself would be subject to tax, whereas under the latter, the entity itself would not︅ be taxed but the members of the entity would be subject to tax."
US Disregarded Entity is "Fiscally︈ Transparent" in Spain, so no spanish registered office required as it's not a legal entity,︉ however you would still need to declare Autonomo & pay the equivelant income tax.
US LLC for US banking, Armenian LLC for Armenian banking really answers the original question. You︊ can ofcourse register a US LLC & then go live somewhere with lower tax rates︋ like Bulgaria, or somewhere tax free as it remains a pass through entity.
"Tax law often contains rules about how certain domestic entities are taxed – either︃ as a separate legal entity or as fiscally transparent. Under the former approach, the entity︄ itself would be subject to tax, whereas under the latter, the entity itself would not︅ be taxed but the members of the entity would be subject to tax."
- US limited︆ liability companies (LLCs), S Corporations and other business entities regarded as partnerships or not liable︇ to the US corporation tax, are treated as fiscally transparent
US Disregarded Entity is "Fiscally︈ Transparent" in Spain, so no spanish registered office required as it's not a legal entity,︉ however you would still need to declare Autonomo & pay the equivelant income tax.
US LLC for US banking, Armenian LLC for Armenian banking really answers the original question. You︊ can ofcourse register a US LLC & then go live somewhere with lower tax rates︋ like Bulgaria, or somewhere tax free as it remains a pass through entity.
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