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Do you have some sort of guide or FAQ which can give potential clients a guide as to the possible extra costs involved for internationals, like typical accounta

by RikNieu 10y ago

Do you have some sort of guide or FAQ which can give potential clients a guide as to the possible extra costs involved for internationals, like typical accountants and lawyers fees? I've been interested in Atlas in the past, but the potential financial unknowns can be... intimidating. For instance, how would this compare to opening a company in Hong Kong?

patio11 10y ago
The TCO of a company depends heavily on your situation, which is one reason we find it difficult to have an official answer on that. As a single data point, my personal tax situation involved US LLCs last year, as an American living in Japan. I spent about ~$10k on accountants to file taxes in both countries plus bookkeeping services. That's towards the high end among my friends; that's nowhere near the high end for "total amount spent on accountants in a year." For comparison, Atlas would have introduced me to an accounting firm offering the US side of that for ~20% of what I ended up spending on it. (This is difficult to do an apples-to-apples comparison even in this case, because C Corp vs LLC, but trust me when I say "I was pleasantly surprised where we got the numbers to.") We're working on having an even better offering here for next year. We'll have more to say that closer to tax season 2017.
soloadventurer 10y ago
Where are you from? Have you answered the following questions? a) What is my foreign affiliate reporting requirements? For a Canadian, you must file a T1134 annually. The T1134 for a controlled foreign affiliate (where you exercise control) is very onerous. It is not that bad for a non-controlled foreign affiliate. b) What is my foreign affiliate taxation requirements, in that foreign jurisdiction? This is an answer that must come from Atlas I guess. But for a foreigner owning a US LLC, where the US LLC will be controlled from a country with which the US has a tax treaty, we get into many complexities. c) Will I have an income pickup from active business income from owning a foreign affiliate? For Canada, this is a "no." d) Will I have an income pickup from passive income earned in a foreign affiliate? For Canada, this is a "yes." Canadians should never earn rental income, royalty income, or other such passive income in a US LLC, for example. e) How will I deal with the "place of central management and control?" Many countries deem a corporation to be resident in that country if you habitually exercise management and control from that country. For example, a Canadian that owns a US LLC will result in the following: - US LLC is a tax resident of the US by virtue of incorporation, and must file a tax return to report earnings from the USA (no flow through). As the LLC will be a resident of Canada as well (see below), branch profits tax of 30% may apply (IRS 884). - US LLC is a tax resident of Canada by virtue of being controlled, "mind and management," from Canada by a Canadian, and must therefore file a Canadian corporate tax return. The situation is different for Canadians owning "C" corporations. However, it brings its own complexities and nuances. The reporting requirements are challenging. For those seeking to own a foreign company, research your own reporting and disclosure requirements carefully.

by RikNieu 10y ago

patio11 10y ago

The TCO of a company depends heavily on your situation, which is one reason we find it difficult to have an official answer on that. As a single data point, my personal tax situation involved US LLCs last year, as an American living in Japan. I spent about ~$10k on accountants to file taxes in both countries plus bookkeeping services. That's towards the high end among my friends; that's nowhere near the high end for "total amount spent on accountants in a year." For comparison, Atlas would have introduced me to an accounting firm offering the US side of that for ~20% of what I ended up spending on it. (This is difficult to do an apples-to-apples comparison even in this case, because C Corp vs LLC, but trust me when I say "I was pleasantly surprised where we got the numbers to.") We're working on having an even better offering here for next year. We'll have more to say that closer to tax season 2017.

soloadventurer 10y ago

Where are you from? Have you answered the following questions? a) What is my foreign affiliate reporting requirements? For a Canadian, you must file a T1134 annually. The T1134 for a controlled foreign affiliate (where you exercise control) is very onerous. It is not that bad for a non-controlled foreign affiliate. b) What is my foreign affiliate taxation requirements, in that foreign jurisdiction? This is an answer that must come from Atlas I guess. But for a foreigner owning a US LLC, where the US LLC will be controlled from a country with which the US has a tax treaty, we get into many complexities. c) Will I have an income pickup from active business income from owning a foreign affiliate? For Canada, this is a "no." d) Will I have an income pickup from passive income earned in a foreign affiliate? For Canada, this is a "yes." Canadians should never earn rental income, royalty income, or other such passive income in a US LLC, for example. e) How will I deal with the "place of central management and control?" Many countries deem a corporation to be resident in that country if you habitually exercise management and control from that country. For example, a Canadian that owns a US LLC will result in the following: - US LLC is a tax resident of the US by virtue of incorporation, and must file a tax return to report earnings from the USA (no flow through). As the LLC will be a resident of Canada as well (see below), branch profits tax of 30% may apply (IRS 884). - US LLC is a tax resident of Canada by virtue of being controlled, "mind and management," from Canada by a Canadian, and must therefore file a Canadian corporate tax return. The situation is different for Canadians owning "C" corporations. However, it brings its own complexities and nuances. The reporting requirements are challenging. For those seeking to own a foreign company, research your own reporting and disclosure requirements carefully.