What's the best place to incorporate an online business?

#1

I have an commerce website. We get around 1000 orders per month and this is going to get quite a bit bigger in next few years.

I am British. I live in Thailand.
Im not allowed to majority own a Thai business and small foreign entrepreneurs are not really welcome. So i need an offshore company.

I need PayPal and an ecommerce internet merchant account. Also looking at alternatives like worldpay. 2checkout etc

Does PayPal need me to be a resident to the country i register my account to? Are there complications being a non resident to get other payment solutions?

Apparently in Hong Kong you need 2 years trading history to get an Internet Mechant Account and they generally turn their noses up at those with less than $1m(us) a year turn over. Singapore seems a bit easier.

I really want to avoid paperwork and book keeping. I hate it.

So i was looking at Seychelles, Panama, BVI, Belize.

Does anyone have experience with payment providers in these countries?

Most nomads i see don’t really have a high volume of small monthly transactions which i do. Im going around in circles and don’t know where to start.

Ill also need a bank account for business and a personal bank account to pay my salary into

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#2

Probably not what you were expecting but I’d recommend the UK. A properly structured UK LLP can allow you to run pretty much tax-free but with the convenience and reputation that comes with a UK entity. It’s also quite cheap to setup and you can use Stripe to process payments (or other low-cost UK processors). You can bank with Barclays, Metrobank etc, get a business credit card etc.

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#3

I’d love to learn more about what you mean by tax-free and based in the UK. Cheers

#4

A UK LLP is a pass-through entity. This means that the tax burden of the company is pass on to its owners. In the event where it doesn’t conduct business in the UK and its members aren’t UK residents, no taxes will be owed in the UK.

Essentially, if all members (shareholders) reside in tax havens or territorial taxation countries (Hong Kong, Singapore, Panama etc), it is possible for the company to operate with a 0% effective tax rate.

That’s pretty damn good considering that it can still benefit from UK banking, payment processing, reputation etc.

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#5

Fascinating. I take it that this is not possible for UK residents?

#6

Interesting! What if you don’t reside in a tax haven? I’m from UK but have been in Thailand / Malaysia for 3 years now.

#7

UK LLP is exempt from VAT?

#8

Does anyone have experience with using a paypal account registered in Belize? Im not talking about a US paypal account linked to Belize. Just a paypal account where you go and sign up putting your address in Belize and link to Belize business business bank account. Can it be used to send and receive money? Or perhaps send only? Lots of conflicting information about it mostly seems to be by Americans trying to link their US PayPal account. I don’t have a paypal account i might want to set one up directly in Belize. Just exploring all avenues. I found this company http://www.belizecompanies.com which is owned by Belize Bank I think and they offer Internet Merchant Accounts too which is smoothing i also need for direct payments

#9

fyi Estonian e-Residency was done just for that purpose. You should check that out e-resident.gov.ee.

#10

It’s possible to register a UK LLP as a resident but it won’t benefit from the tax exemption.

#11

The UK LLP is exempt from paying UK VAT if it doesn’t do business in the UK. It isn’t exempt from paying VAT or other relevant taxes in other countries if applicable.

#12

Malaysia is a tax haven, Thailand isn’t however. To answer your question, the company would still be tax exempt in the UK but you would likely be taxed on your share of its profits in your country of residency.

#13

Is there anything like a LLP in the UK with just one member? From what I know you need at least 2 for a UK LLP…

#14

You can use another company (that you own) as the partner and that company can be registered in a tax haven.

Otherwise there is the normal Ltd entity but it’s not as convenient tax-wise.

#15

Have you checked

?

#16

The kaspar_korjus response cannot be taken into account as he was the head of Estonian E-residency programme. His opinion is biased. I would not recommend Estonia as its tax on distributed profit is 20%. So if you have an online business, you don’t have many expenses and when you want to pay yourself through dividends, you have to pay 20% of tax.

#17

You could organize a US LLC and then open an account at a US bank. As long as you don’t have employees or dependent agents on the ground in the US who operate your business, you won’t be subject to US tax.

#18

Hi @StewartPatton
But every single US companies that have income from US residents is liable to US corporate tax, isn’t it?

#19

Hi @nouk. No, that’s not how it works. Instead, it works pretty much like in the UK (as mentioned above).

An LLC with a single member is simply treated as not existing at all for US tax purposes. Its assets and activities are treated as those of the member.

A non-US person is only subject to US tax on business income if they’re “engaged in a trade or business in the US,” which requires them to have at least one employee or dependent agent on the ground in the US running the business.

So, if a non-US person does an Amazon FBA business (for example) through a single-member LLC, and they’re the only one working in the business, there’s no US tax payable.

#20

@nomadtax: with Malaysia, you refer to Labuan (for company set-up)?
Or foreigners can have tax-free income from abroad?