I am currently a UK resident operating a nutra trial business with profits in excess of £1 million a month. Currently my structure is incredibly simple and I am simply paying 20% corp tax with a UK business. However, I was wondering if there would be any structures that suit my current situation and would allow me to drop this as low as possible (it's seriously eating into my profits) For example can I not simply open a non-resident cyprus IBC and pay 0% corporation tax in cyprus with nominee directors. This business would then take my payments and hold the product itself under the guise of it being an affiliate network. I could construct my own functioning fake affiliate network with working tracking and dashboards and then pay my own wage as affiliate payouts from that "network" into my UK corp for personal income whilst paying 0% tax on the cyprus business and having a cover story as to where my UK salary is from/that I do not own the cyprus company and it is merely an affiliate network I work with?
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Structure for UK resident
- Thread starter iniwanginwg
- Start date
That's why I'm aksing here to get a guage of what I nede to ask when I get professional advice. So I don't sound as stupid when I seek professional help. So I appreciate the reality check. No I do not need to remain a UK resident as long as whatever residency I have has a decent enough passport.
How about a cyprus company + a Seychelles holding company. That would allow me to pay the 12.5% cyprus tax and also funnel profits through to the Seychelles holding company using royalities on the domain name and name licensed to the cyprus corp? Is that more reasonable?
You can setup this constalation but you will still have troubles to get a bank account for the Seychelles company unless you find an agent that is able to help you with both of it and it's "clean business" means you will have to setup a cover business for your crypto.
I don't do crypto. I have a legitimate product that I sell
. In which case would the setup I was talking about be applicable? The seychelles +cyprus one? thanks for the reply I appreciate it.Alright awesome. So that a strat is viable though? Cyprus + Seychelles strategy would work for my situation with my product to minimise tax? If I'm correct I can get down to an effective tax rate of <8% with this?
It is far better to pray for a no-brexit deal...hehe
. The UK chancellor has already pledged to cut corporate tax to below 15% in a no brexit deal. In the last few weeks the PM has also vowed that UK will have one of the lowest tax rates also. UK corporation tax is less than 10% of all tax revenue collected by the UK 
. Personal income tax, VAT and NI, excise duty etc is how UK gets the bulk of its tax revenue. They could strip defense spending and make the UK completely corporate tax free if they really wanted to 
.Osborne pledges to cut corporation tax
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I don't see how this avoids the CFC rules in UK as you control >25% of the companies involved. In which case you're paying for a lot of puff and smoke.
Pricing is no issue to me because my product currently does a significant amount of money - and more soon. Excess of 1 mil a month. GBP.
Just googled that. The cyprus corp would be resident cyrpus corp so that avoids that. "A foreign company is a CFC if it’s a non-resident UK company that’s controlled by a UK resident person or persons.".
It is far better to pray for a no-brexit deal...hehe
Osborne pledges to cut corporation tax
Yahoo ist jetzt Teil von Oath
Honestly if uk became 0% corp tax that'd be wonderful - same for if they even dropped to 10%. I feel you on the other taxes. I pay 45% income tax and it's killing me man. Enough to make me wanna seek other alternatives to being uk citizen.
when I say it's no issue I mean I'm happy spending tens of if not 100k £ into this if it gets me a proper setup as described and can slash my corp tax down to sub 10%. It'd save me 100k gbp monthly if it were down to 10%.
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The law says "non-UK resident company", and that means any company that is not a "UK resident company". It includes the Cyprus corp.
https://www.legislation.gov.uk/ukpga/2010/8/part/9A see 371AA(3)
Actually with 100k gbp/month you can create enough substance and also since Cyprus is within EU it should work.
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100k a month is what I'm saving in tax by dropping to 10%. I currently pay in excess of 200k gbp tax a month. It's horrible.
Enough substance as in I need to make it appear as it's functioning out of cyprus. Perhaps a real physical office with some paid off "employees" as native people there just sitting doing whatever - perhaps taking calls for support?
What kind of tax professional would be best to consult about this? I mean a normal uk tax lawyer woulnd't be experienced in this kind of setup. So what do I search to find someone suitable to advise me properly?
I think a UK international tax lawyer would know these rules.
If you're willing to move then there are all kinds of options.
From a cursory reading of the law, one option could be to use the finance company exemptions that are designed to lure international companies to have their headquarters in the UK. So what would your business look like if you tried to look like a multinational business with UK headquarters?
Maybe something like:
UK Holding LTD
Offshore Finance LTD
Offshore Trading LTD
Offshore Trading LTD has low capitalization and mostly 0 in profits. It pays interest on a loan to Offshore Finance LTD.
Offshore Finance LTD is a group financing company.
Offshore Trading LTD will be a CFC and UK Holding LTD will pay, but its profits are low or 0.
Offshore Finance LTD is also a CFC but under the finance company exemptions pays 19%*25% = 4.75% tax in the UK.
For all companies you should avoid having a permanent establishment in the UK.
This is very complex and the above is just messing around. You need to talk to a competent lawyer.
If you're willing to move then there are all kinds of options.
From a cursory reading of the law, one option could be to use the finance company exemptions that are designed to lure international companies to have their headquarters in the UK. So what would your business look like if you tried to look like a multinational business with UK headquarters?
Maybe something like:
UK Holding LTD
Offshore Finance LTD
Offshore Trading LTD
Offshore Trading LTD has low capitalization and mostly 0 in profits. It pays interest on a loan to Offshore Finance LTD.
Offshore Finance LTD is a group financing company.
Offshore Trading LTD will be a CFC and UK Holding LTD will pay, but its profits are low or 0.
Offshore Finance LTD is also a CFC but under the finance company exemptions pays 19%*25% = 4.75% tax in the UK.
For all companies you should avoid having a permanent establishment in the UK.
This is very complex and the above is just messing around. You need to talk to a competent lawyer.
Oh, and to get rid of the 4.75%, add UK Startup LTD and use the EIS scheme to invest 15.8% of your profits into UK Startup LTD. Then UK Holding LTD has no taxable profits. You just need to figure out what business the startup should get into 
You may find some of the more experienced certified accountants like Turner Little, or local Cyprus one Aliott Partellas Kiliaris Ltd and there are even more, they are able to help you with the right setup and structure.
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