Zander
@Zander
I did some research into this but depending on the scale of your company I may or may not be worth it. Assuming you keep on being a tax residence in Spain you will pay income tax there regardless (possibly dividend tax). The thing that might be cheaper is the corporate tax rate. I don't know what the rate in Spain is but for my situation it just simply wasn't worth it to save a few % of tax but going through the hassle of setting up a company in a remote foreign country.
Of course, for me a few % was a few thousand euros which would be lost again by the additional costs, but if you scale up it might be interesting.
I think both of you are right but are talking about different things. As far as I know Marc is right with regards to the $50k being taxed for income tax in The Netherlands (assuming you are a tax residence in NL) it you get that as income. The remaining $950k will not be taxed by The Netherlands because it simply isn't income. However, you can't use this $950k because it simply isn't yours, if you want to use it (privately) you will have to pay income tax (or dividend tax) on that $950k. If you keep it inside the company in the US or Singapore NL won't tax it until you make it income.
Of course, in your example you shouldn't forget corporate tax. That is the tax that is being paid in the land where your company is. For The Netherlands it depends on how much you earn, but Singapore has a flat 17% rare.
This is not really how it works unfortunately. It is very complicated and this is why I am saying you need to do research based on what country you are in. Hiring a tax expert would be best.
If you run a Singapore-registered business(or any other country) while living in the Netherlands there is a very high chance that the Dutch Tax authorities will say your business is "operating" from here and make you pay taxes, and social payments, here.
They do this by looking at your business and will decide where your "Fiscale vestigingsplaats" is. This decision is made based on where the owners of the business live, where the business is operated, and where the customers are located.
If this wasn't the case, every business owner in The Netherlands would simply register their business in other countries and pay less corporate tax.
If true, that would be crazy! You're telling me, if I'm Dutch and live in The Netherlands but am the sole shareholder of a Singapore corporation that does most of its business with non-Dutch customers, it would still be considered a Dutch business?
Yeah its kinda crazy.
You don't need to be Dutch, just living here. The government will look at it on a case by case basis to determine if you are operating in.
Ofc if you are owning a cafe in Singapore its very easy to say its operated there. But if you have an online business and do all the work from the Netherlands it gets difficult.
They're both correct because these are actually two different topics: Tax residency is the one and "ultimate beneficial owner" - or alternatively "controlled foreign company" - is the other.
They relate to each other, but they're not the same thing. Helps a lot more with research with using the terminology.
THEN, you still get into Double Taxation Agreements between the countries you're dealing with, and how corporate income tax works between them.
I visit WeWork from time-to-time, with the on-demand pass it is doable but could be a bit pricey. Alternatively if you are looking for something long term there is a truly awesome coworking space in the Adam tower (across the river on the opposite side of Amsterdam Central station) up in the tower with awesome views. No day passes though.
I didn't know about 'fiscale vestigingsplaats', food for thought. Thank you!