What are the best offshore options for UK resident running a UK ltd?

[JustAnotherNomad]

It’s no problem at all to keep the company in the UK.

I think Malta should be high on your list. Should be 5% tax and no corporate tax in the UK if correctly structured (local branch/subsidiary) + some fixed cost for the structure. But I don’t know enough about Malta for the details.

See these threads:
https://www.offshorecorptalk.com/threads/malta-5-scheme-structure-formation.30071/post-145826https://www.offshorecorptalk.com/threads/recommendation-malta-or-cyprus.24847/
One other option would be to move to a tax free country like the UAE and pay yourself a salary from the UK company (or to invoice it as a freelancer as employment could be expensive to set up correctly in the UAE). You could still travel freely and live in different countries in Europe, as long as you don’t trigger tax residency rules. But I think Malta would be a better solution and you’d also lock in EU residency, while it’s still possible.

 

[khinkali]

Why wouldn’t Cyprus work? 60 days and you can receive dividends tax free.

You have been valiantly correcting people on this Web site for months. Territorial taxation can be a trap. At first nobody cares that your $800 per month is not technically foreign sourced. But if you do well then you find out that the country where you thought you were hanging out tax free, is not so tax free.

I am not saying that Cyprus can't work. It's on my list. It might be perfect for crypto. Like Georgia where I am now it might be perfect for crypto. But as this week's threads have shown, there are differing views on Cyprus and basis of taxation. Why do I stress about this? Because these are the same arguments that made Thailand perfect for residence with territorial taxation when I used to live there. But I was scared about the possibility of a retrospective change to the taxable base.

That is what happened. Suddenly crypto transactions were all based on the location of the owner. I'm glad I left before that happened. It's not like I even made a huge amount of money, but in accounting and tax terms they could have skewered me. I was turning over quite a lot of Baht, for not a lot of profit. But what if their measure of profit doesn't match my actual bank balance? I left the UK mainly over a problem with inflexibility and VAT. Some people are really good at working the system. Some of us just don't get it and need an escape route.

These are reasons not to write off awkward locations like UAE and Sark. Yes, TH, CY and GE seem ideal "territorial" locations, but if your income isn't really passive you need to be very, very careful. I want to make GE work because I like the people, food, weather and wine. But I don't think I'll feel comfortable until I have a ruling.

Yes, I am actively involved in day to day running

One think that I notice about you polonieth is that you're asking about moving to a new jurisdiction while still paying corporation tax in your old jurisdiction. You're not asking too much and I think you can find a good result if you are careful.

I don't know your exact business model but I suspect that regulations might be more important than taxes. I guess with a UK Ltd and a business partner in UK you have that covered.

 

[JustAnotherNomad]

You have been valiantly correcting people on this Web site for months. Territorial taxation can be a trap.

Yes, you are right, of course. But in this case, there is a partner and substance in the UK. I think it should be possible to get an advance ruling from the tax office in Cyprus.
We also don’t know the amounts this is about.

I personally would always feel more comfortable with a tax-free country, rather than a country with territorial taxation.
But then again, Malta and Cyprus have this as their business model. There thousands of people with such structures. I think it’s not very likely that they’d kill that off.

Alternatively, one could move to Estonia, register a branch/subsidiary and only pay tax on dividends that are paid out from the company. Zero risk, as I see it. And then of course the chances of somebody checking where you’re actually spending your time are slim to none - e.g. 5 months in Spain, 4 months in Italy, 2 months in Sweden and just 2 weeks in Estonia and 2 weeks in the UK.

With proper substance (and willingness to accept the UK corporate income tax as the worst case situation), you have a lot more flexibility.

 

[khinkali]

@JustAnotherNomad I am of course watching this thread exactly because you're taking the line that you don't normally take. Partly because you are more considered than most people on this issue, and partly because OP's username gives us a hint on what we're discussing.

Georgia is the posterchild of this kind of situation. Most people on these forums prefer Cyprus, but this week's other threads make Cyprus sound like Thailand did before things went bad. UAE has obvious advantages. I think Sark does too, in a more European location.

 

[polonieth]

@JustAnotherNomad I am of course watching this thread exactly because you're taking the line that you don't normally take. Partly because you are more considered than most people on this issue, and partly because OP's username gives us a hint on what we're discussing.

Georgia is the posterchild of this kind of situation. Most people on these forums prefer Cyprus, but this week's other threads make Cyprus sound like Thailand did before things went bad. UAE has obvious advantages. I think Sark does too, in a more European location.

I do hold crypto and have done ok from it, but my main source of income is through online businesses.

Thanks for the tips, I will keep looking into things. I believe at my level it's worth relocating as I don't get too many advantages from being in the UK. I could do with something showing me a roadmap tbh. Forums, while useful are a minefield

 

[JustAnotherNomad]

Maybe talk to a service provider like Turner Little. Haven’t worked with them, but they seem to enjoy a good reputation.
Always double check any information people give you with licensed accountants/lawyers from all countries involved, especially when something sounds very simple.

One other thing I believe hasn’t been mentioned yet is exit tax. That is a tax you have to pay for leaving your country of tax residency. I’m not sure if the UK levies exit tax, but that would be critical to investigate before moving anywhere.

 

[xipoid]

Georgia is the posterchild of this kind of situation. Most people on these forums prefer Cyprus, but this week's other threads make Cyprus sound like Thailand did before things went bad. UAE has obvious advantages. I think Sark does too, in a more European location.

Which threads in particular? Is this just from the point of view of crypto?

 

[khinkali]

Yes @xipoid I was referencing to crypto, but it isn't polonieth's main income now. I am thinking about threads like Avoiding taxes on cryptocurrency trading profits (Cyprus). When knowledgeable people aren't clear on the tax or legal status of your business activity, it's a big warning sign. It's one thing to know that a country might propose a new tax, pass a law and then implement it. It's another thing to worry about some reinterpretation of tax law that catches you retrospectively.

 

[James2122]

I don't think it's a scam, if you want to know more just contact the guy. He is selling his sark society membership for $1650 and you can pay with PayPal. You can quickly get a refund if you smell something fishy.

Where was this?