551–560 of 789 posts
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The real problem becomes substance in Estonia? Residence, local director, office, ...
You only need a contact person and a legal address, which is only €100-200/yr. You don't need a local director, physical office or similar, and you don't need to live there.
> Which leaves the only real question. Why 25,000 at all? It is my company and my risk. If I want to start with nothing, that is my call, not a toll the state collects before it will let me try. > And the cheap door has a price of its own: to some clients, “UG” reads as “not serious,” and they would rather deal with a GmbH The post itself explains exactly why the first complaint is a fallacy and the second one is tru…
That system is silly. I can open a company, work for a year, acrue debt, acrue tax debt, close it. Nothing will happen. Company "estate" will be sold to cover the debt, which can also be nothing.
Honestly why go through all these hoops? Is the Wyoming LLC + Wise account route shut off for most Europeans?
Yes. Can't just emigrate. No substance in the US meaning your llc would be liable for tax as if it were an llc in the country where you reside. You'd basicly double the liabilities and administration for no good reason.
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The exit tax doesn't apply to "gains", it applies to the "value of your company" which is calculated in a way that often means you will owe thousands or even millions in money you don't have, and at no time had.
Yes - the value of your company is the gain. It is the money you would have if you sold the whole thing.
Selling a company and paying tax on the profit in tax is a completely different proposition from paying tax on hypothetical profit you haven't made (and might never make) just because you want to move.
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Can't you just incorporate a Wyoming LLC (zero corporate tax + federal tax because you're non-resident in the US) then just open a Wise account? Wyoming LLC gives passthrough taxation, and because you're in Germany, you'll be subject to German corporate and personal taxes alone, I presume? Edit: changed from just personal tax to personal+corporate
Finanzamt may well decide this is a German company in the cunning disguise of a cowboy hat, and charge it German corporate tax
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The point I thought was a plus was that you'd be paying German taxes without all the German bureaucracy? Because there's definitely no bureaucracy for a Wyoming LLC except for a couple of IRS forms annually.
Unfortunately it doesn't work like that. You are just adding us bureaucracy+ dual accounting (euro/USD) to German bureaucracy where nothing changes .
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> sometimes shit happens and debts go unpaid What’s wild is that this is pre-debt. The banks will have their own risk math for you so it’ll be a completely separate set of hoops before you get to be in debt as a company. Most will not even talk to you if you have 0€ in the business account. I don’t feel like a company with no assets or income can do that much damage to their societies. Also as a small company in the…
> I don’t feel like a company with no assets or income can do that much damage to their societies. Keep in mind that those companies will almost always own some debit to their employees when they blow up. IMO, $25k is a ridiculous amount of capital to require from a company before they can operate. But capital requirements are good, and they should be proportional to employment, not company existence.
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> In the UK I can started a Ltd with £1 of share capital, about £100 of fees, and filling out a form online. I will be shielded from personal liability if it goes tits up unless I've broken the law, knowingly traded insolvent, or otherwise been an idiot That's what Germany calls an "UG". Which is what OP actually ends up doing.
UG forces you to retain profit to hit a capitalisation target. An Ltd is a real company, and my £1 company has an identical legal status to one with hundreds of millions of pounds of assets.
If you're a startup, you won't be making a profit anyway.
Once you make a profit, 25k€ on the books (not necessarily cash) isn't a lot, especially as it doesn't have to remain in the company, you can use it to pay wages once converted to a GmbH.
In the end, this is a question about whether you need something to be exactly the same for some ideological reason, or whether it's enough that two things are practically the same for all intents and purposes.
And while in this case the German system requires a codified workarounds, in many other cases the US/UK/Commonwealth systems use significantly more complicated workarounds than the German system.
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It doesn't really matter. If you do business in Germany you are evading taxes just by the fact of doing business. Everything and anything you make belongs to the government. It is an unfortunate loophole in the law that temporarily permits you to steal some of your profit back from the government where it rightfully belongs. Yeah, this is sarcasm, but not really. The practical reality is that it simply makes no sense…
If you don't like the laws/rules then just leave Germany . There is no justification for tax evasion .
Or change something. But yeah, I agree that leaving a country that you don't like is a good solution. I did that myself.
> There is no justification for tax evasion
The basics of philosophy behind taxation state exactly the opposite: it is an obligation of a business to evade as much tax as possible - as long as it is legal.
Wait until you find out about electronic invoicing mandates rolling across Europe.
This at least carries the potential of simplifying things for honest businesses.