How to get money from your business partner

[capybard]

Great forum, surfing it for 2 weeks, but didn't find what I'm looking for...

Ann and Bob are business parters
Ann lives in country A (Asia)
Bob lives in country B (EU, very high taxes)
Ann is a sole proprietor in Georgia
With that she makes $200k yearly, together with Bob

How can Bob get his half from her?
Except for the legal way (register as an entrepreneur, resolve double treaty, get money, pay taxes)

The initial plan was that he has Ann's bank card and use it for groceries, gas, Apple Pay and so on.
But that's much less than $100k
Also he can withdraw from ATMs, but what to do with all that cash then? Only buying gold from locals comes to mind (shops are asking for ID)

Moreover, that initial plan seems to be a bit risky: it's too easy to see that Ann lives in A and spends in B at the same time

Ann can't simply send the money as a present, gift tax is big
Ann can "pay out the debt" to Bob, but it looks like one time solution

Some ideas, please let me know what you think of them:

1. Buy, mix and send crypto
Downside 1: Ann's Georgian bank is very sus about all crypto
Downside 2: Bob has no idea what to do with crypto then

2. Ann can buy stuff for herself de jure, for Bob de facto. E.g. a villa
That requires a lot of trust between the partners. Sounds shaky

3. Establish Bob's offshore company and buy services from "Ann the Georgian"
Maybe become sole proprietor in Georgia too? (with proper handling of upcoming CRS)
Invest Georgian money in some property Batumi/Tbilisi to rent it out

 

[Sols]

Ann is a sole proprietor in Georgia
With that she makes $200k yearly, together with Bob

That doesn't sound like a sole proprietorship. The income belongs to Ann and only Ann. Bob has no claim on it. If Bob wants to be involved in the business, there needs to be an agreement where Ann hires Bob as an independent third-party contractor. Or, they need to form a company together.

Form a Georgian company and make Bob a minority shareholder. Appoint Ann as director of the company. If nothing else stands out, it's possible Bob might be able to get dividend income, pay taxes on that where he lives, and no one will question it. If Bob is actively involved in the company, that can create problems. To get around that, Bob could maybe work for the company as a third-party contractor/consultant and get some income through that channel, and some through diviends.

A good lawyer/tax adviser could and should help Bob with this.

How can Bob get his half from her?

Ann can give him a gift. Depending on applicable gift tax laws (and amount and relationship between the two), this gift may be subject to tax.

The initial plan was that he has Ann's bank card and use it for groceries, gas, Apple Pay and so on.
But that's much less than $100k
Also he can withdraw from ATMs, but what to do with all that cash then? Only buying gold from locals comes to mind (shops are asking for ID)

That's called tax evasion and/or money laundering, which of course can work, until it doesn't.

1. Buy, mix and send crypto
Downside 1: Ann's Georgian bank is very sus about all crypto
Downside 2: Bob has no idea what to do with crypto then

Downside 3: Bob goes to jail. Or maybe just gets to pay a lot of fines and penalties.

 

[zomundaprince]

what if bob leaved in a low tax or non taxed country