VISA/MASTERCARD don't accept non-resident owned US LLC - need EU UK or Lithuanian LLC

[Greenberry]

I found a wall - as I'm foreigner from EU owning and being director of US LLC, I'm not able to sign contract with none of the payments processor for my E-commerce to start accepting cards payments. Tried almost 30 processors, and there's no answer, or answer like "need to have US citizen in company structures" or "need to have EU company".

I chosen second option.

I would like to form 1 person owner, 1 director LLC in UK or Lithuania. I more trust UK, as they are bigger, more stable country, as well they communicate in Language I do know. About Lithuania I heard many good things, even Monese started to have their accounts there, but I'm afraid of foreign language that I do not know, in case of being asked to explain something about my business (marketplace e-commerce) I think I'll be more difficult, also, I'm Polish, and we are not much liked there (Polish schools are being closed there, Polish are loosing their properties).

Does somebody were in front of such choice? What is better for e-commerce?

 

[bnpsu]

Are you in Dropshipping?
What did stripe say?
UK LLP would be liable for UK VAT?

 

[SaintVince]

Oh, wow.i was planning to set up us llc for that purpose.
Couple of weeks back stripe started closing accounts, and PayPal needs ITIN etc but now looks like this is a bigger trend.

OP please provide more info on the company activity to confirm if this is isolated case related to dropshipping or if this is a final nail in the coffin.

 

[Greenberry]

Are you in Dropshipping?
What did stripe say?
UK LLP would be liable for UK VAT?

Kind of Dropshipping.

Stripe want us to incorporate with them in Delaware, I do not trust, as Delaware is place where everybody incorporates, and if you are "Delaware LLC" you might have bad smell for some ones.

UK LLP - yes, I know, but then, I prefer to pay 19% of VAT, than do not have income from EU at all.

 

[bnpsu]

Oh, wow.i was planning to set up us llc for that purpose.
Couple of weeks back stripe started closing accounts, and PayPal needs ITIN etc but now looks like this is a bigger trend.

OP please provide more info on the company activity to confirm if this is isolated case related to dropshipping or if this is a final nail in the coffin.

interesting, where did you see stripe closing accounts?

 

[Greenberry]

Oh, wow.i was planning to set up us llc for that purpose.
Couple of weeks back stripe started closing accounts, and PayPal needs ITIN etc but now looks like this is a bigger trend.

OP please provide more info on the company activity to confirm if this is isolated case related to dropshipping or if this is a final nail in the coffin.

We basically got an e-commerce website, where we accept purchases. Then, we sent money to our partner who ships the device, and he's basically responsible for the shipping. Having this structure in my opinion saves us from the limit of each EU country sales (100 K ~ 400 K EUR per county) and we don't need to open a branch in every country that we ship to, becouse in fact, transaction is accomplished by the partner.

Overall, during conversations with the processors, we didn't made till this point of explanation of our business. We always been stopped earlier - at the time of presenting our company structure - US LLC formation documents, EIN, Bank account, then shareholder - EU foreigner - BAN.

 

[Greenberry]

For interested ones, these processors will not accept your foreigner, non-resident owned US LLC:


2checkout
Allpago
Aps payment
Bluesnap - unsupported busines type
Braintree - PayPal service, so need same as PayPal (SSN, ITIN)
CCbill
Concardis
Datatrans.com
ePayments - got only for EU EUR IBAN
G2A Payments
Ingenico
Klarna
Pagbrazil
Payoneer - I got account with them, but looks like they are limited to acceptance payments only from some platforms (Amazon etc.)
Paysafe
Paysafecard
Przelewy24 - EU companies only
Six-payment-services
Skrill
Stripe - need to be formed by them, or living in US
Tpay
Trustly
Trustpay.eu
VR Payments
Poli payments
Paytrail
Worldline

 

[SaintVince]

We basically got an e-commerce website, where we accept purchases. Then, we sent money to our partner who ships the device, and he's basically responsible for the shipping. Having this structure in my opinion saves us from the limit of each EU country sales (100 K ~ 400 K EUR per county) and we don't need to open a branch in every country that we ship to, becouse in fact, transaction is accomplished by the partner.

Overall, during conversations with the processors, we didn't made till this point of explanation of our business. We always been stopped earlier - at the time of presenting our company structure - US LLC formation documents, EIN, Bank account, then shareholder - EU foreigner - BAN.

Ok, in your case you could draft a dealership agreement between your llc and manufacturer(brand owner) for sale of goods worldwide. with this piece of paper you should be able to show the connection between you and the manufacturer.

most companies would like to see some presence, so bring some product to a 3pl warehouse and show stripe etc. that you actually have some products in country and will be also shipping it by your own means.

this way you might be able to convince them to set you up with an account

 

[SaintVince]

For interested ones, these processors will not accept your foreigner, non-resident owned US LLC:


2checkout
Allpago
Aps payment
Bluesnap - unsupported busines type
Braintree - PayPal service, so need same as PayPal (SSN, ITIN)
CCbill
Concardis
Datatrans.com
ePayments - got only for EU EUR IBAN
G2A Payments
Ingenico
Klarna
Pagbrazil
Payoneer - I got account with them, but looks like they are limited to acceptance payments only from some platforms (Amazon etc.)
Paysafe
Paysafecard
Przelewy24 - EU companies only
Six-payment-services
Skrill
Stripe - need to be formed by them, or living in US
Tpay
Trustly
Trustpay.eu
VR Payments
Poli payments
Paytrail
Worldline

This is very valuable info. Thank you for posting!

 

[Greenberry]

Ok, in your case you could draft a dealership agreement between your llc and manufacturer(brand owner) for sale of goods worldwide. with this piece of paper you should be able to show the connection between you and the manufacturer.

most companies would like to see some presence, so bring some product to a 3pl warehouse and show stripe etc. that you actually have some products in country and will be also shipping it by your own means.

this way you might be able to convince them to set you up with an account

Thanks, but that's it's not possible to made, and again - I've been assured ex. by CCBill that EU company owned by EU citizen they are able to serve us. So that's my question from - UK or Lithuania. I guess I'll stick with UK.

 

[kor2]

these processors will not accept your foreigner, non-resident owned US LLC

Would it make any difference if you incorporated a foreigner, non-resident owned US C-Corp?

 

[JustAnotherNomad]

I also think somebody here mentioned being advised to set up a US C-Corp to get access to banking and then billing that C-Corp from another LLC that is taxed as a disregarded entity. That was for dropshipping as well, and I think he was also looking for access to Stripe.

 

[avalanche]

I also think somebody here mentioned being advised to set up a US C-Corp to get access to banking and then billing that C-Corp from another LLC that is taxed as a disregarded entity. That was for dropshipping as well, and I think he was also looking for access to Stripe.

Sounds like tax evasion if IRS does audit

 

[avalanche]

Would it make any difference if you incorporated a foreigner, non-resident owned US C-Corp?

C-Corp supposed to pay all US taxes. There is no disregarded status for C Corp

 

[JustAnotherNomad]

No, why? Just needs to be set up correctly. Worst case the C-Corp has to get a certain cut of the deal.

 

[JustAnotherNomad]

C-Corp supposed to pay all US taxes. There is no disregarded status for C Corp

You didn’t understand the concept. We are talking two companies.
Customer -> C-Corp (LLC 1) -> disregarded entity (LLC 2) -> UBO

 

[bnpsu]

You didn’t understand the concept. We are talking two companies.
Customer -> C-Corp (LLC 1) -> disregarded entity (LLC 2) -> UBO

How will you get the funds from C-Corp to disregarded entity without paying corporate tax on the C-Corp?

 

[JustAnotherNomad]

I would assume it’s a regular service agreement. You might have to keep an arm length’s distance (c-corp must get paid a commission). Or maybe the c-corp could simply be a payment processor.

I didn’t suggest that setup, somebody else said they had been recommended something like that for a dropshipping business.

 

[bnpsu]

I would assume it’s a regular service agreement. You might have to keep an arm length’s distance (c-corp must get paid a commission). Or maybe the c-corp could simply be a payment processor.

I didn’t suggest that setup, somebody else said they had been recommended something like that for a dropshipping business.

It sounds like if that setup works (ie. your exposure is on the c-corp's level) - then you don't need the LLC. You can just push from C-corp to the UBO

Am I missing anything?

 

[JustAnotherNomad]

Possibly. I’m not an expert on US taxes.
I’m thinking that with payments going directly to the UBO, it may be classified as a dividend payment and subject to withholding tax? Then again, a disregarded entity should be treated just like the UBO for tax purposes?
I guess one should really talk to a CPA, I just wanted to mention it.

Here’s the thread I was thinking about, maybe @mardz has found a solution in the meantime:

https://www.offshorecorptalk.com/threads/usa-inc-vs-llc-is-my-tax-planner-trying-to-fool-me.29368/
Lots of previous threads about this stuff:

https://www.offshorecorptalk.com/th...c-payment-processors-dropshipping-tips.27556/
https://www.offshorecorptalk.com/threads/shopify-dropshipping-as-a-non-us-resident.28476/