holding company setup

[John Andrews]

If's not difficult. I'm guessing there are 100k companies like this in the UK as it was a very cheap way of avoiding expensive audits in The Netherlands previously. I used one previously, paid GBP 200 to set one up, and given a yearly audit that would cost GBP 1000, it was a no-brainer.

Unrelated question: how do you apply for PayPal then? I mean which country do you choose, UK or the one the Ltd is actually resident in?

 

[blockchain4ever]

Unrelated question: how do you apply for PayPal then? I mean which country do you choose, UK or the one the Ltd is actually resident in?

By the way, here is the EU court case clarifying that a branch of a dormant parent company is completely legal and cannot be questioned by the tax authorities within EU.

The company will be a UK company with a branch office in Czechia. On the letterhead, you will typically do business as "Company X Ltd (Czechia branch)", but you don't necessarily have to add that (Czechia branch) everywhere.

You can have a GBP account outside of the UK, branch outside the UK, not have a PE in the UK, and not do any business in the UK. You can still trade in GBP.

PayPal might refuse a dormant company, I don't know. But the company is a UK company, so there should be no problem registering it as a UK company.

On the other hand, the branch will be registered in Czechia, so it will have a company identifier in that country as well, and that can be used for whatever business needs to be done in that country. This is all standard when you have branches in other countries.

 

[John Andrews]

That's amazing. Can the Czech branch trade globally (not only within Czechia)? Does it then only pay tax on locally sourced income?

 

[John Andrews]

PayPal might refuse a dormant company

I'm guessing one could change the SIC code to something else other than 99999.

PayPal probably doesn't check this anyway.

 

[blockchain4ever]

That's amazing. Can the Czech branch trade globally (not only within Czechia)? Does it then only pay tax on locally sourced income?

Taxation of branches can get complex, but it is simplified by the fact that the UK disregards it completely.

In the simple case with a single branch, what the Czech branch pays in taxes is up the the local tax rules in that country, but typically that will be on all global income.

Now if your branch is in Georgia, then you might get away with territorial taxation on your branch.

 

[John Andrews]

So what would be the point of all this then? Also there no audits in NL for a BV if your revenue is below 500k EUR right?