Earlier quoted context omitted.
This will require research on each countries laws, some countries have very rigid definitions of what qualifies as employment and will not allow those payments to be classified as contract income, dividends, or anything else.
The way I do it, I set up a limited liability company that is just my own name. I then charge for services rendered and income goes into a company in my sole ownership. I then pay salary to the only employee (me). This is common and completely legal.
Ask HN: What is the best jurisdiction for internationally distributed teams?
171–180 of 208 posts
Re: Ask HN: What is the best jurisdiction for internationally distributed teams?
#172Earlier quoted context omitted.
I am indeed another European and I do know about the issues with being a "US person". Many banks and brokers will simply immediately close your existing account or not allow you to open one. However, are you sure that simply by owning a US company you become a US person? Because according to my understanding if you don't live in the US (and don't spend more than 4 months / year there) you wouldn't actually be tax res…
The US doesn’t care if you live there or not (unlike every other country except China); you still have reporting requirements and technically have to file returns saying you don’t owe taxes.
Re: Ask HN: What is the best jurisdiction for internationally distributed teams?
#173Earlier quoted context omitted.
The way I do it, I set up a limited liability company that is just my own name. I then charge for services rendered and income goes into a company in my sole ownership. I then pay salary to the only employee (me). This is common and completely legal.
> I set up a limited liability company that is just my own name. I then charge for services rendered and income goes into a company in my sole ownership. I then pay salary to the only employee (me). This is common and completely legal This approach exploded fairly spectacularly in the UK for many of those deemed by the tax office (HMRC) to be using it purely as a device to attempt to avoid being "on payroll" https://…
This might not be an issue if the corporate income tax + financial gains tax comes out the same as payroll tax. The bigger issue here is that you can use the remaining funds to invest and losses form a tax deduction base. More commonly however people just cram as much personal consumption inside the companies before paying out the salary, even things like travel and dining out. In the EU, VAT is commonly quite high and you get refunds on that if the expenses are on the company.
Re: Ask HN: What is the best jurisdiction for internationally distributed teams?
#174Earlier quoted context omitted.
The way I do it, I set up a limited liability company that is just my own name. I then charge for services rendered and income goes into a company in my sole ownership. I then pay salary to the only employee (me). This is common and completely legal.
I highly doubt this is completely legal, maybe unless you are not expensing the company anything (and transferring all of the revenue as salary).
Re: Ask HN: What is the best jurisdiction for internationally distributed teams?
#175I’ve founded companies in the UK, US and EU. I’d recommend the UK. The cost of a limited company is £12. It’s formed in a day. Use https://www.ukpostbox.com if you need an address. The legal system is well known and entrepreneur friendly. Accountancy and company admin are simple and relaxed. HMRC is supportive. You can pay dividends on a flexible schedule. There’s a very large ecosystem of financial support, innovati…
How comparable is Ireland? It’s still common law but also still part of the EU. Was considering Ireland to incorporate with a Brazilian friend, I’m from Belgium. Belgian is like Germany. Not a good country to incorporate. Would have preferred the UK but Brexit complicates everything.
From what I could find, using a service company to sort everything out - company registration, bank account, legal address, first year taxes filed etc - the cost was around €1000. The same service in the UK is much cheaper.
I guess this only matters relative to the size of your business. At the time I was only looking for a small holding company, with not much revenue initially.
Re: Ask HN: What is the best jurisdiction for internationally distributed teams?
#176That's a pretty complex question with a lot to unpack. (Except: Minimize your contact surface vis-a-vis Germany. That part seems easy.) First off: There is no such thing as a "remote friendly" jurisdiction. Estonia is trying to market this, but don't drink the Kool Aid. Someone is going to have to make a trip to the bank or the notary every now and then. They'll have to show their faces. They'll have to affix their s…
Very interesting setup. I’ll have to think a bit about that. Thanks for the write up.
Re: Ask HN: What is the best jurisdiction for internationally distributed teams?
#177Then there are plenty of company that offer as a service to hire for you in the other countries removing you from the hassle of figuring out the technicalities of other countries.
Re: Ask HN: What is the best jurisdiction for internationally distributed teams?
#178Why?
* Anybody from Northern Ireland is entitles to both UK and Irish passports, meaning they can live and work in both the UK and EU
* Booming tech industry, 3 Universities all with a strong focus on tech
* Can trade into both the EU and UK markets
* Great broadband etc
* Lots of VC's/Investment opportunities
Re: Ask HN: What is the best jurisdiction for internationally distributed teams?
#179If you intend to get VC funding, then you have to "keep it standard." Don't do anything new, weird, etc. The "Cayman-delaware sandwich" is quickly becoming the go-to structure for Latin American startups. It's well known and has a ton of advantages, but I believe it only works if your business is not actually US-based: if the bulk of your customers are in the US, for example, then you might have to do a Delaware corp…
Can you recommend some pointers to learn more about the Cayman-Delaware sandwich? I assume the payment processing would be in the US?