Most tax efficient residence in EU: Bulgaria, Romania, Cyprus?

[James7]

If Estonia company pays no tax until distribution, could you lend yourself say 50% of the profits each year, (pay the company arms length interest eg 9%) and pay zero tax as no dividends?
How much could your company lend you annually before it looks like tax avoidance and be a legal problem?

 

[Marshal]

I believe that Slovakia also has some gems where one can live, but I must agree with the above, it is not a place I would immediately take my family to live. I would find other places and live with a higher tax.

I guess Prague would suit someone with a family better. Never spend long periods of time there, but whenever I visit the Czech's capital alone, or with friends/family we leave with happy memories.

 

[Marzio]

whenever I visit the Czech's capital alone, or with friends/family we leave with happy memories

Especially when BigSister was active.

 

[JosephLL]

If you stay within Schengen, Bulgaria is good. You can cash out from 20-30k/month as salary with low tax, don't have to wait for yearly dividends. Easy to maintain tax residency without staying in the country (with the correct setup).

If you want to stay outside of Schengen, Cyprus is good, travel in and out through North Cyprus while it looks like your inside the country. You can take a shareholder loan for 9% interest and then clear it against dividends.

No matter what, always make sure to have the correct setup (yearly rental contract, utilities, arrange monthly cc spending within the country with receipts).

Why 9%? Is this enforced by some kind of regulation?

 

[EliasIT]

You need to put a interest rate of the marked value, I don't think 9% is necessary however, then you are on the safe side.

 

[Dandyline]

Why 9%? Is this enforced by some kind of regulation?

https://www.aretilaw.com/wp-content/uploads/2021/05/Tax-treatment-for-loans.pdf

 

[ilDavid6311]

+1 for Bulgaria; also, after joining Schengen, as long as you keep producing documents (rent, utility bills), you can always keep residency while staying outside the country.

 

[CoinMaster]

+1 for Bulgaria; also, after joining Schengen, as long as you keep producing documents (rent, utility bills), you can always keep residency while staying outside the country.

how often do you have to get these documents and to whom ?

 

[ilDavid6311]

how often do you have to get these documents and to whom ?

Best option is to rent a real cheap apartment outside Sofia; in some villages, prices can be as low as €150 per month. After renting the apartment, sign-up for internet and utility bills, and keep paying it in order to keep it active.

If you need help with it, ping me.

 

[dziter]

+1 for Bulgaria; also, after joining Schengen, as long as you keep producing documents (rent, utility bills), you can always keep residency while staying outside the country.

I guess that you have to find a way to have real consumption for your utility bills (to show someones lives there) to be on the safe side?

 

[ilDavid6311]

I guess that you have to find a way to have real consumption for your utility bills (to show someones lives there) to be on the safe side?

Workarounds for that too; but consider that internet and bills are always flat fees, and with agreements with apartment owner, is possible to have flat fees for utilities as well.

 

[bountymounty]

Bulgaria sounds really appealing, how much are the costs for a basic setup?

 

[ilDavid6311]

Bulgaria sounds really appealing, how much are the costs for a basic setup?

Around $2k for non-resident UBO company (all fee included) + high street banking

 

[MarkusCostigan]

Around $2k for non-resident UBO company (all fee included) + high street banking

Do you think there is a possibility to operate through a US LLC from Bulgaria and pay 10%?

 

[ilDavid6311]

Do you think there is a possibility to operate through a US LLC from Bulgaria and pay 10%?

It depends, so many variables. For what you need an US LLC? Where's the managing based? Where's the "center of interests" of the company? And so on.

 

[MarkusCostigan]

It depends, so many variables. For what you need an US LLC? Where's the managing based? Where's the "center of interests" of the company? And so on.

The idea would be to appoint a Bulgarian company as a member of the LLC. Hire a manager for the LLC in Bulgaria, an office... in short, a bit of substance.

Why the LLC? Easy management, anonymous (publicly), purely online sales. No physical goods. No presence in US.

If I needed an EU company I could still use the Bulgarian.

 

[Don]

The idea would be to appoint a Bulgarian company as a member of the LLC. Hire a manager for the LLC in Bulgaria, an office... in short, a bit of substance.

Why the LLC? Easy management, anonymous (publicly), purely online sales. No physical goods. No presence in US.

If I needed an EU company I could still use the Bulgarian.

PE in Bulgaria pays 10% CIT.
Basically you would need to register a branch office of LLC in Bulgaria. There is no WHT if you repatriate profits so 10% can be the total tax rate depending on your personal residence.
All accounting needs to be prepared according to Bulgarian regulations. It doesn't really change the management much compared to a Bulgarian company.

 

[vehzag]

Around $2k for non-resident UBO company (all fee included) + high street banking

You do this? Can you send a pm the other details please