To go offshore or to stay (e-business)

Hello again this thread is more or less similar to this but i didn't want to hijack it, as I feel this deserves a thread of its own



So once again will use a hypothetical example with rounded numbers:

* ABC OnlineMedia Ltd trades in the online advertising sector (ala Google) banner ads, pay per click text ads etc
* Its expenses are in 99% to the US and remainder to some EU countries excluding Ireland
* Its customers are in US, Israel and BVI, none in Ireland or EU
* ABC OnlineMedia Ltd is currently an Irish company
* Income by the employees and directors is taxed by Revenue against tax credits etc
* Remaining Co. profit is taxed by corporation tax
* Employees who are also the directors only require electricity and internet connection to do work
* Company is vat exempt [broken link removed] and confirmed by Revenue

Should said company close in Ireland

Setup offshore? employees remain in Ireland (or employees could move too)

This way income tax would still be paid, if they stay? but no corporation tax??



Any taughts? i know "offshore" is a dirty word but said company doesnt trade in ireland as such

Where are the directors of the company resident?

currently in Ireland, but not much holding them here, business can function anywhere theres electricity and fast broadband and preferably sunny weather to keep up the high spirits

if theres nothing holding you here i would take a look at moving to panama. you will pay 0% tax (legally) on all of your online earnings and they have huge tax incentives/discounts for foreign people moving there(google search pensionado visa) Beautifull beaches and 50c for a beer along with excellent infrastructure and healthcare. on the other hand if you stay here i would advise against incorporating offshore because most of the offshore duristrictions are rolling over for government bodies. Sure you could do it, but then get hit for a huge tax bill in a few years if/when revenue catches up with you. Like you i make my money online and am now registered as a sole trader. It kills me having to pay almost half of my profits to the government. I had considered doing the offshore thing while remaining here but id never have peace of mind, I have been researching panama for the last few weeks and its deffo worth considering.

Hi

If your centre of management is in ireland you are taxed for Ct in Ireland.

If you relocate to Panama then as ireland does not have a tax treaty with them and as it is an irish company you are taxed in Ireland.

if you close down your irish company and open a panama one and relocate totally to there you are not taxed in ireland. Employees have to move too!!!


Regards


Dbran

thanks for replies its an interesting situation to be in

ive been researching a few locations now

moving is not a problem as things are just getting more depressing and expensive to live here all the time

what about setting up offshore and having it bill your irish company for "services" so the irish company has no profits left to pay corpo tax on?



@jigsaw see my other thread here i am after finding out that beside the corporation tax there are hidden surcharges for small companies http://www.askaboutmoney.com/showthread.php?t=118883

talk about a kick in the balls

yeah theres no incentive to do business here in ireland, because the government just takes amost 50% of what you earn if your a sole trader and hand it out to social welfare recipients.

i could really scale up my earnings online if i wanted to but whats the point when ill get raped by the government?

Theres not a chance in hell i will remain in this country for more than a few years

dfh said:

what about setting up offshore and having it bill your irish company for "services" so the irish company has no profits left to pay corpo tax on?

Click to expand...

If the directors/employees are not Irish resident and perform a number of their duties outside of Ireland, it is possible for the limited company to apply for a PAYE exclusion order whereby salaries can be paid to these individuals by the Irish company without the operation of Irish PAYE. This is easier to obtain for employees than directors. And in the case of the directors you also have to ensure that they continue to perform their duties relating to the central management and control of the company from within Ireland in order that the limited company continues to be considered as tax resident in Ireland (if this is something you want).

It is very unlikely that you will get an exclusion order for a director. Case law (Tipping v. Jeancard) and taxing rights allowing country of registration of company to tax directors earnings regardless of where director is resident