Are you investing your own funds or third-party funds?

[Martin Everson]

The business is investment through a discountbroker.

Are you investing your own funds or third-party funds? If its your own offshore funds and your living in Panama why the need for an offshore company?

I think @Admin can split this off into a new thread if needed.

 

[atze]

It is my own and legal money. And Panama does not tax capital gains, so basically I wouldn't need that whole corporation account construction thing.
BUT: Panama and the US do not have a tax treaty. That means if I die, my wife would have to pay inheritance tax in the US, because I am trading through an US broker AND I mainly hold US equities. I know...she could just take the money off without declaring it...but that is a little too risky and can be avoided...with a corporation. And it is legal. If I put it in a corporation she just gets the company and there is no inheritance tax, because the corporation does not die.
I already have a Panama corporation here (needed to establish one for the Visa), but it's totally useless. Internationally nobody wants it, especially with my Ukrainian wife in it (like I said, even EPB rejected it) and the local banks here in Panama suck big time. They don't understand the whole investment topic and think it is money laundering. The workers in the banks here are just complete incompetent and stupid, I never experienced anything like that somewhere...you cannot imagine.
So...that's why I want a new corporation.
One with that I can open a new interactivebrokers account and a few regular bank accounts. Then withdraw money each month and maybe one day I need to change something... a new corporation....a trust...whatever. And then I would need to take it all out and switch it over to something else. MAYBE I even need to move it all now already for getting the money into the new brokerage account, I don't know if they allow sending it directly from the personal brokerage account to the corporation account.
That's why I need/want a few regular bank accounts. BUT...here in Panama I want to avoid making this transactions...not because of taxes (like I said...I don't need to pay taxes anyway here).... but because they are so extremely stupid and suspicious here. The Panama papers is what made them suspicious and stupid is what they are naturally.
That's why I would like to know if a Belize corporation with just by myself is better or a Cyprus corporation with my Ukrainian wife and me. Or maybe even Cayman Islands? There is also just 1 person needed.
And since Panama and US is not so far away I thought maybe I can just open a few accounts over there. But I don't know if they still open accounts for foreign companies.
Besides that, banks that open remotely would be most comfortable of course, especially since Panama and Europe or Asia is very far away for flying over to get a bank account.
So the big question for me is where to incorporate. Belize is for sure the cheapest, but I don't know if the banks still like them, seems like not from what I have read here in the forum. Cyprus seems to be much better, but is that the case even with my wife in it? And is that correct, that there is no tax in Cyprus if it is declared a foreign company? Or is even Cayman better?
Sorry...got a little long.
Thanks for your help guys!

 

[Martin Everson]

That means if I die, my wife would have to pay inheritance tax in the US, because I am trading through an US broker AND I mainly hold US equities.

btw I discussed this subject in the below thread. I would think long and hard as a U.S non-resident before setting up a U.S estate tax avoidance vehicle i.e single owner offshore passive personal investment company.

Nevis LLC and general LLC questions

If I put it in a corporation she just gets the company and there is no inheritance tax, because the corporation does not die.

Sounds good in principle. However did a U.S tax advisor or IRS tell you this is ok?

Also a move to Panama seems strange even to me knowing its reputation. There are far better territorial tax countries you could have moved to and also not be taxed on capital gains remitted unless you really wanted to live in Panama. Panama has all the wrong connotations for anything to do with finance and the banks there as you discovered are not easy .

Also assuming you have a bit of money and will trade more than a handful of shares per an order why IB and not flatex.de for example?

 

[atze]

Thanks for the input. But my questions are not about why I live here or why I trade at IB. It's about which country is best for incorporating for getting a bank account with my constellation. ;-)
But...to answere your questions: I came not here for the tax purpose...that was just a bonus. I came here for living.
And IB is just the cheapest broker for US equities. There might be a few that are about the same or even a liiitle lower, but there Margin interest is way higher and...IB actually pays interest on unused cash, meaning at times, where the liquidity is higher there is no need to switch to any treasuries or bonds or whatever.

 

[atze]

BTW...i have read your thread. You are save if do it that way...that's one of the reasons why even wealthy US citizens open offshore corporations and Trusts....to avoid inheritance tax. They have the same problem, only with higher allowance (at the moment about 11mio while just 60k for nonresidents).

 

[pluma]

Does this require someone to move to Panama in order for this to work tax wise?

 

[atze]

You mean the inheritance tax?
No, you can do this from any country in the world.
But you have to check if your country has a tax treaty with the US. And if it does, what it covers.
Because many countries have a tax treaty with them and would not need to pay inheritance tax anyway, so it's not needed there.
The other way is of course taking all assets out of the account and switch it over to the widows name without reporting that the person died.

 

[myhand]

The other way is of course taking all assets out of the account and switch it over to the widows name without reporting that the person died.

The widow's name! So you need to wait until your wife is dead?

 

[atze]

What I mean is, if YOU die and your wife would have to pay inheritance tax because you have US assets and there is no tax treaty between your country and the US she could just take the assets out of the account and transfer the money into an account in her own name, before reporting your death to the bank or wherever.
This way the money is out, no bank can withhold it or whatever and she would not need to care about inheritance tax, because the US cannot sue her or something if she does not have to do with them in any other way.