I dont know, as I mentioned before even I had Russian passport I could receive and process around 30-50k on my personal account without a single question
Would UK Ltd be a good idea for investing in software development?
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The idea of doing development from UK and making profit in AM is appealing. I have no idea how BEPS rules work but I do believe there's an exit tax for intellectual property transfer from UK.
If the UK company reclaims VAT but has no Vat-able income (i.e. net refund) then I would expect to be audited.
If the UK company reclaims VAT but has no Vat-able income (i.e. net refund) then I would expect to be audited.
Technically what stops me from just using source code in another company without a trace? Given that I'm a sole owner, I can price the software in any way I like or totally avoid any transfers of IP.
There will be no other company member who is able to claim IP violation or anything like that. Would be also hard to figure out what exactly these developers did make under this UK LTD
Although it would still suck big time if I were not able to do it totally legit way
Last edited: Jul 15, 2020
The UK company isn't charging market rate to your AM company. I wouldn't want to guess if you fall foul of some anti avoidance measure; this is where tax lawyers get rich.
How would HMRC know? A company losing EUR 3k per month isn't abnormal. I've had a worse software development business in the past.
But that's for income. If you are reclaiming net VAT then expect some scrutiny.
How would HMRC know? A company losing EUR 3k per month isn't abnormal. I've had a worse software development business in the past.
But that's for income. If you are reclaiming net VAT then expect some scrutiny.
I'm already thinking of some US LLC lol. Cant even pay people salaries without getting fucked by taxman these days.
Transfer pricing rules. I don't think the taxman cares much for small companies, but for big companies this is a huge area.
I think it is possible.
UKLTD is simply a R&D company that contracts out to freelancers. So it making a loss is not an issue.
There is no VAT implications until the company hits £70K turnover.
The funds he invests can be structured as a loan as its his personal savings.
The most important structure is the IP of the software and where that would be held.
Who contracted the UK Ltd to make it.
As mention earlier its the transfers of the product which has a price or a licencing fee.
IP owner company is the paramount issue.
If you do not intend to sell software in the UK than an LLC is the best option. Or licence software to Armenian company then they pay the UK company. No tax due on the LLC.
UKLTD is simply a R&D company that contracts out to freelancers. So it making a loss is not an issue.
There is no VAT implications until the company hits £70K turnover.
The funds he invests can be structured as a loan as its his personal savings.
The most important structure is the IP of the software and where that would be held.
Who contracted the UK Ltd to make it.
As mention earlier its the transfers of the product which has a price or a licencing fee.
IP owner company is the paramount issue.
If you do not intend to sell software in the UK than an LLC is the best option. Or licence software to Armenian company then they pay the UK company. No tax due on the LLC.
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