Structure for UK resident

[anticfc]

However if the original poster wants to completely avoid all kinds of trickery (it didn't seem like it in the first post but who knows), company tax rate is a flat 9% in Hungary and lawyers and accountants are dirt cheap compared to UK standards.

There's still management & control trickery involved.

 

[totlori9]

There's still management & control trickery involved.

The general solution to that is a hungarian nominee director. If you count that as trickery then you are definately right. What I meant by no trickery was no actual trickery in the way of what entities the money is flowing through .

 

[blizz]

So if we have a local director and office we should have found a way around the "trickery" question or what?

 

[totlori9]

So if we have a local director and office we should have found a way around the "trickery" question or what?

I am not perfectly sure what you are asking but I'll try to answer anyway:

If you have a local director than the place of management & control issues don't arise. By issues I mean that if the place of management and contorl stays in the UK that would give the HMRC an oppurtunity to consider the hungarian company a UK tax resident based on the OECD double tax treaty between the two countries. This is what the local director avoids. The company stays a hungarian tax resident with 9% tax.

In the above solution if the OP still is the stakeholder of the hungarian company he still has to pay dividend tax normally (as described in the double tax treaty) as he does now in the UK. So he can only capitalize on the 9% Hungary corporate tax rate vs 19% UK tax rate (note the OP said 20% in the first post for some reason). However that is quite signifficant regarding the mentioned 1M GBP/month and the income lands in his name in the end.

In the other example where the OP would direct the profits through a passthrough taxed LLP the income would land in the hands of the nominee shareholder who is resident in the 0% tax country on paper not in the hands of the OP. This obviously further complicates things. Some people have no problem with the money not being in their name, some others solve this with a trust deed or a loan. This was what I called trickery. And this was the part that is not needed in the hungarian company solution.

I am new here and I can not send PMs yet (my bad, haven't taken the time to read how they work on this forum yet). I'm going to assume you can, so if something is not clear or I haven't answered your question completely feel free to send me one.