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Is a Delaware LLC worth it for an European Founder?
Hey everyone,
I’m a European freelancer dev with clients in the US, and now my own apps are starting to generate some consistent monthly revenue.
With freelancing only, my tax setup was fine. But now, with income coming from Stripe and App Stores, things get complicated.
Europe is way behind in this sort of thing and filled with bureaucracy that only complicate things.
So I’m considering setting up a Delaware LLC via Stripe Atlas as an intermediary.
- The LLC would handle all international income/expenses and be used as a pass-through entity, paying 0% tax as a non-resident.
- Then I'd transfer a single amount to the Portuguese company each month, pay tax here and make it easier to report and hopefully simplifying most of the bureaucracy.
Here are the options I'm considering:
- Delaware LLC + Portuguese Company: Use the LLC for all online transactions, revenue and expenses, and transfer one payment to a Portuguese company monthly, and draw a salary from there.
- Portuguese Company Only: Use a regular Portuguese company and handle everything locally, including Stripe, App Store income and all expenses.
So I'm wondering if an LLC is worth it?
Or should I just do business as a Portuguese-based company?
I'd love not to be asking this stuff here, but unfortunately I can't find accountants that have experience with this.
So any advice or recommendations would be greatly appreciated!
Thanks!
I’m a European freelancer dev with clients in the US, and now my own apps are starting to generate some consistent monthly revenue.
With freelancing only, my tax setup was fine. But now, with income coming from Stripe and App Stores, things get complicated.
Europe is way behind in this sort of thing and filled with bureaucracy that only complicate things.
So I’m considering setting up a Delaware LLC via Stripe Atlas as an intermediary.
- The LLC would handle all international income/expenses and be used as a pass-through entity, paying 0% tax as a non-resident.
- Then I'd transfer a single amount to the Portuguese company each month, pay tax here and make it easier to report and hopefully simplifying most of the bureaucracy.
Here are the options I'm considering:
- Delaware LLC + Portuguese Company: Use the LLC for all online transactions, revenue and expenses, and transfer one payment to a Portuguese company monthly, and draw a salary from there.
- Portuguese Company Only: Use a regular Portuguese company and handle everything locally, including Stripe, App Store income and all expenses.
So I'm wondering if an LLC is worth it?
Or should I just do business as a Portuguese-based company?
I'd love not to be asking this stuff here, but unfortunately I can't find accountants that have experience with this.
So any advice or recommendations would be greatly appreciated!
Thanks!
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A US LLC is only going to make it easier for you to take US transactions and payments, but that's about it. You'll still need a US Bank + address to make taking US checks easier, you'll still have to file US taxes even if it's mostly passing through to you personally, and you'll still need to pay for the filing and possibly an accountant to handle it for you. The business (LLC) will still owe taxes on US income from businesses, even if your personal income doesn't have to pay US taxes out of what you pay yourself. I'm not sure how you get around that.
Could you go into what exactly is complicated? What issues are you trying to solve for? PT not able to account for Stripe income?
Don't forget PoE and CFC rules. You'll probably pay corporate tax in Portugal for your US LLC, since it will be managed from Portugal.
I always hire two. Find someone in Portugal to asses impact of the US-based entity in Portugal and find someone in US (Probably Atlas would be able to answer?) to assess impact on US-based taxes.
Honestly, if it's just "some" revenue I'd try to make it work as a freelancer and then probably start a Portuguese company.