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Forming a company which operates outside of the US

Asked by: Jan  — 6 December, 2012


I want to start a online business and everything is ready to go except the company is not formed.

I do have a quesstion regarding forming the company.
I am permanent resident of the USA and will mainly sell my services (no goods) via website in the United Kingdom and/or Germany.

If I form a LLC in the USA, do I have to open a separate office/company local in each country? Or can I just control and work everything here from the USA?

How is it if I form a company outside of the USA, would I need to open a local branch and tax my separate income in USA? As far as I know has the United Kingdom and Germany a contract with the USA to make sure you don’t have to pay twice tax.

I would really appreciate any help!

Thanks a lot.

Answered by: admin  — 6 December, 2012


You can open a US company and have that company sell in other countries. All the profits will be subject to US taxation.

Taxation in the other countries will be governed by individual treaties with those countries, for example, you would not be double taxed on business profits from the UK or Germany, because both of those countries have a treaty with the US, that allows you to avoid double taxation on the same profits.

I can’t speak specifically to other local taxes, for example VAT tax they could possibly be subject to, but as a general rule US companies are not required to collect VAT tax for sales in the EU.

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