4 ms·

So which solution did you adopt in the end?

by ilurk 11y ago

hackerboos 11y ago
I incorporated in Hong Kong which has the same tax advantages but with more stringent reporting requirements (you will actually need an accountant). The main reason was because the banking system is much better in HK than in the Seychelles. You could open an account in another country but many won't touch a Seychelles IBC with a barge pole. HK has a better reputation. Incorporating is easy. Getting a bank account can be difficult.
- sivers 11y ago
  Thanks for bringing this up. I've had the same experience. Doing a virtual business based nowhere, where even my own country of residence is constantly changing, it made sense to explore the lean efficient jurisdictions for incorporating. For what it's worth, I've tried a bunch of incorporators, but found the best success with Trident Trust. Great bang per buck: http://www.tridenttrust.com/corporate_overview.html http://www.tridenttrust.com/corporate_overview.html + http://www.tridenttrust.com/PDFs/Companies-IND.pdf http://www.tridenttrust.com/PDFs/Companies-IND.pdf But like "hackerboos" said here, the hard part can be finding a bank willing to open a business bank account for your foreign company. So contact your bank first and ask. Especially if you have an existing relationship there. At Wells Fargo, for example, I was able to just walk in, talk to my usual dude who knows me by name, and open an account for my foreign corporation in 15 minutes. He didn't care (or even seem to notice) that it wasn't a U.S. corporation. All they cared about is that I had my U.S. Tax ID#. (IRS form SS-4.) But even with international-friendly banks in Hong Kong and Singapore, even ones where I had a deep relationship, I've found they're averse to opening accounts for foreign corporations. They require a lot of extra paperwork, and a $50k minimum balance, but will do it.
  - ukoki 11y ago
    I recently set up an HK corporation and bank account with HSBC and had no requirement for a minimum balance. I think there is a monthly fee if your balance is below some low amount, but that's it.
- crdb 11y ago
  Adding another data point(s) there: I opened two HK companies (with much the same reasoning as you did), about 5-6 years ago and again about a year ago. The first time was smooth and the bank account happened without a meeting (at HSBC) although I didn't use the structure and folded it a year later. The second time was a lot less smooth, I had to fly to Hong Kong to meet HSBC, and after they took a relatively annoying processing fee and grilled me on my business model (IT consulting), rejected my application with no explanation about 3 months later. The agent told us most foreigners were routinely declined these days although they didn't know why. We thus opened a company in the UK instead (yes, it's still a great offshore location!). Fast (minutes on the Companies House website), cheap (< 100 GBP?) but the bank (Lloyds) hit us with a fraud check which months later is still not resolved, despite reams of paperwork travelling around and notaries public making a small fortune in certifying documents, and my co-founder being a UK resident. Lloyds asked us for more information than the Singapore Government did for my PR (equivalent to US green card) application. Since you can't do business on a personal bank account if you have a UK Ltd, that structure is basically inactive.
  - ukoki 11y ago
    As a third data point: I (UK national) set up a company (also IT consulting) in HK just a few months ago without any problems. I still had to fly to HK for the bank account, but they set it up the same day. Lloyds has terrible, terrible customer service. I mistakenly chose them as my bank when I did consultancy through a limited company in the UK. Never again.
    - crdb 11y ago
      Which bank would you recommend in the UK?
      - ukoki 11y ago
        I really don't know. My accountant recommended Cater Allen, and they seemed pretty on top of things when I phoned them up. Unfortunately I couldn't satisfy their paperwork requirements though, which is why I went with Lloyds in the end.
- eonw 11y ago
  HKs reputation is only slightly better. In some industries(ones that include copyrights, for instance) no one will touch an HK entity either.

So which solution did you adopt in the end?

by ilurk 11y ago

So which solution did you adopt in the end?

I incorporated in Hong Kong which has the same tax advantages but with more stringent reporting requirements (you will actually need an accountant). The main reason was because the banking system is much better in HK than in the Seychelles. You could open an account in another country but many won't touch a Seychelles IBC with a barge pole. HK has a better reputation. Incorporating is easy. Getting a bank account can be difficult.

sivers 11y ago
Thanks for bringing this up. I've had the same experience. Doing a virtual business based nowhere, where even my own country of residence is constantly changing, it made sense to explore the lean efficient jurisdictions for incorporating. For what it's worth, I've tried a bunch of incorporators, but found the best success with Trident Trust. Great bang per buck: http://www.tridenttrust.com/corporate_overview.html http://www.tridenttrust.com/corporate_overview.html + http://www.tridenttrust.com/PDFs/Companies-IND.pdf http://www.tridenttrust.com/PDFs/Companies-IND.pdf But like "hackerboos" said here, the hard part can be finding a bank willing to open a business bank account for your foreign company. So contact your bank first and ask. Especially if you have an existing relationship there. At Wells Fargo, for example, I was able to just walk in, talk to my usual dude who knows me by name, and open an account for my foreign corporation in 15 minutes. He didn't care (or even seem to notice) that it wasn't a U.S. corporation. All they cared about is that I had my U.S. Tax ID#. (IRS form SS-4.) But even with international-friendly banks in Hong Kong and Singapore, even ones where I had a deep relationship, I've found they're averse to opening accounts for foreign corporations. They require a lot of extra paperwork, and a $50k minimum balance, but will do it.
- ukoki 11y ago
  I recently set up an HK corporation and bank account with HSBC and had no requirement for a minimum balance. I think there is a monthly fee if your balance is below some low amount, but that's it.
crdb 11y ago
Adding another data point(s) there: I opened two HK companies (with much the same reasoning as you did), about 5-6 years ago and again about a year ago. The first time was smooth and the bank account happened without a meeting (at HSBC) although I didn't use the structure and folded it a year later. The second time was a lot less smooth, I had to fly to Hong Kong to meet HSBC, and after they took a relatively annoying processing fee and grilled me on my business model (IT consulting), rejected my application with no explanation about 3 months later. The agent told us most foreigners were routinely declined these days although they didn't know why. We thus opened a company in the UK instead (yes, it's still a great offshore location!). Fast (minutes on the Companies House website), cheap (< 100 GBP?) but the bank (Lloyds) hit us with a fraud check which months later is still not resolved, despite reams of paperwork travelling around and notaries public making a small fortune in certifying documents, and my co-founder being a UK resident. Lloyds asked us for more information than the Singapore Government did for my PR (equivalent to US green card) application. Since you can't do business on a personal bank account if you have a UK Ltd, that structure is basically inactive.
- ukoki 11y ago
  As a third data point: I (UK national) set up a company (also IT consulting) in HK just a few months ago without any problems. I still had to fly to HK for the bank account, but they set it up the same day. Lloyds has terrible, terrible customer service. I mistakenly chose them as my bank when I did consultancy through a limited company in the UK. Never again.
  - crdb 11y ago
    Which bank would you recommend in the UK?
    - ukoki 11y ago
      I really don't know. My accountant recommended Cater Allen, and they seemed pretty on top of things when I phoned them up. Unfortunately I couldn't satisfy their paperwork requirements though, which is why I went with Lloyds in the end.
eonw 11y ago
HKs reputation is only slightly better. In some industries(ones that include copyrights, for instance) no one will touch an HK entity either.