5 Best Places to Form a Dropshipping or E-commerce Company?
ฝัง
- เผยแพร่เมื่อ 28 ก.ย. 2024
- Get personalized advice about tax, asset protection, offshore banking, residency, and citizenships: calendly.com/m...
You can visit our websites for more information about us: offshorecitize... & www.offshoreca...
Today I'm going to answer the commonly asked question which is ''where is the best place to structure a company for e-commerce and dropshipping company?''
This is not an easy question to answer because it will depend on many factors: where are your customers from, where are your products coming from, which currencies are you charging in, where is your staff located, what you need for payment processing, etc.
The first thing to think about for this type of business is payment processing for example where can you get Stripe or PayPal. This is going to factor in processing rates and currencies. This will rule out many places that you'd typically consider. You don't want to base an e-commerce company in Labuan or Georgia. Montenegro, Panama, the British Virgin Islands, or any other commonly used offshore country is not going to be a good place for this type of business.
Which are the places to look at? US is the first one that comes up, as well as some EU/EEA countries like Cyprus, Estonia, Gibraltar. Also, Hong Kong & UAE might be interesting options.
When you're in the e-commerce or dropshipping industry you will need to look at two things simultaneously - low tax rates and low payment processing rates. EU/EEA area will typically have the lowest credit card processing rates.
The second thing that you'll want to consider is currencies and conversions.
Who are we and what do we do?
We are Offshore Citizen team. We help people become global: get a second passport, set up a second residency, pay less taxes, do banking abroad, etc.
We have lots of interesting articles on different topics, we have relevant information up to date.
Author: Michael Rosmer
Feel free to join our community!
Don’t forget to subscribe to our channel
/ @offshorecitizen
Very beneficial information - I noticed you mentioned Cyprus and was wondering if you can create a video on Malta as they are relatively close to one another and how VAT works. Thanks for your content
Happy to be of service ☺
You can check out some of these:
th-cam.com/video/hNpAz3ZM3F8/w-d-xo.html
th-cam.com/video/PIqBIVUjp-o/w-d-xo.html
th-cam.com/video/RQjlNtfNrxk/w-d-xo.html
th-cam.com/video/_GzKW46bEHY/w-d-xo.html
you mentioned Cyprus and Estonia as top choices for EU. Which one is better though? I'm assuming Estonia is cheaper to run
Hi Michael,
Is it a good idea a US LLC + Cyprus non-dom is a good idea?
Thanks for your content!
Im thinking about this aswell but I think you need to pay personal income tax with non dom in Cyprus or ?
I get loads of FB & Amazon sellers asking me to setup up in Ireland.
The only issue is they don't have an EEA director I need to get them a two year govt bond at €1.7k (€850 per year) so my €750 fee to form, co sec and registered office is now €2,450.
The VAT is easier now post OSS at least
Keep up the great content Michael. Does the advice within this video also apply to setting up an Amazon FBA business, and/or also, a 'Print-on-Demand' business model? Thanks.
Other concerns in choosing a country for your business are customer criticism, product returns and consumer litigation Michael.
Would an idea for another video could be on business in the micro-states like Saint Marino, Andorra, Lichtenstein and you have already discussed Malta.
Thank you Michael for another interesting topic.
Good observation!
Thanks for the suggestion, definitely a good idea👍
We've done 1 or 2 on San Marino
great Video, very informative and helpful! thank you so much😊
A pleasure! Anything you'd like to see next? :)
Paying 10% corporate tax in Bulgaria while having residence in Romania (I am EU citizen) and getting paid it all minus 5% Romanian dividend tax, is doable, right?
Just saying this cause I would rather live in Romania than Bulgaria.
Amazing content.
Great insights, sir. How dumb an idea is it to use western union, moneygram or other similar services as a receiving paymt facility? I understand WU has options of receiving paymt through online banking and charges sending parties roughly $5/transaction. Trying to find ways to avoid traditional gateways like paypal etc since Im trying to price my service super cheap and trying to go for high volume transactions while avoiding forex conversions, bank and handling fees.
UAE is definitely the best option for ecommerce if you want traditional payment options like PayPal and Stripe, but there's no need to settle in Dirham's if you don't want to. You could settle in any currency you want. If you have a bank account in UAE and it's in Dollars or Euros then no problem. It's the same the other way around too, so as I'm currently based in the UK, if REALLY wanted to I could change all my accounts to settle in Mexican Peso's. I don't think transaction fees are too much of an issue because if you are selling globally (as you should) then you are going to pay higher rates anyway. For example most of my customers are in the US but PayPal charges me about 5%!! For my European customers, it's only 2.9%. Stripe is the same, but at 1.4% for local customers. So really it doesn't matter too much where you go, they will F*** you with transaction fees.
Awesome video! is it true that you are tax free if you have set up an llp in England and your company is in Dubai and also living there? It concerns dropshipping to customers in Europe.
Does citizenship matter ? I'm Australian citizen doing a SAAS business ( monthly subscriptions more like ecommerce) I live in UK ATM, I'm considering Cyprus, trifecta approach
What if you’re in crypto and ecom?
is uae suitable for youtubers?
Thanks Michael, very helpful indeed 🙏 - what about the Isle of Man for e-commerce ?
Great video as always! I have one tip I think can help some to reduce fees related to exchanging currencies if they use Stripe and Revolut.
In Stripe you can set up bank information for multiple currencies. When a payment is received in a currency that is configured in Stripe, then Stripe will transfer the amount to your bank without exchanging currency first. Normally this require that you have access to several bank accounts in different currencies but if you have a multi-currency account like you can get with Revolut, then its possible to connect multiple currencies in Stripe to the same Revolut account.
Just set up the different currencies in Revolut, check account information under each currency and add this information under the same currency in Stripe. For most currencies this means adding the same IBAN number for several currencies but this still seems to work. I have only tested this for 4 currencies and low volumes but every test worked as I hoped it would.
Thank you and thanks for sharing the tips with us all! Definitely interesting and useful.
Any suggestions for future videos?
@@OffshoreCitizen Thats good.
I find your videos extremely useful and I particularly like videos like this one and other videos thats not just about taxes but about how to set up businesses for different industries and business models. I find most business opportunities in high tax countries (Norway and Spain) so anything related to making things profitable in high tax countries is content I find very useful.
I would like to learn more about patent box and similar. I don’t think I have ever seen a video comparing what companies can expense in different countries. I think many would be particularly interested in travel expenses. For example, I have a company in Norway but do business in Spain and travel there a lot. When I’m in Spain I can expense a fixed fee per day (about EUR 85) in addition to transport, lodging etc. That makes it a lot cheaper for me to spend time in Spain than in Norway.
It’s also hard to find videos about how sales taxes work for different goods and services when delivered from another country. Particularly when/how you can legally avoid paying sales taxes or how to avoid or get sales taxes back from your business expenses when your expenses are in a different country than where your business is located. I pay a lot of different types of expenses to Google every month. Some have Norwegian VAT added, others not. I don’t get whats different between TH-cam Premium vs. Google Cloud vs. GSuite etc.
Great video! i like the idea of focusing on particular groups of interest (aka people interested in dropshipping).
Thank you!
Anything else you'd like to see?
Hey there, I am running multiple e-commerce brands, I am currently registered as a business in my home country belgium. Taxes are really bad and not optimal. I wanted to ask you if it's a bad idea to stay here with my business? I don't really want to move from my home country but i guess it's necessary to move to the country where you want to move your business to? Is it a bad idea to just stay here or not? Thank you for the videos! Love the content
"but i guess it's necessary to move to the country where you want to move your business to?" There are several non-grey listed jurisdictions which allow you to incorporate without a resident directory or shareholder such as UK, Hong Kong. As an EU citizen, my eyes are set on Ireland because the requirement is that you are living anywhere in the EEA for at least 180 days per year.
Stripe in UAE now means hopefully Shopify payments will follow soon... thanks for the video Michael.
This is why a company that exclusively sells digital products & accepts payments exclusively in a crypto with a rational transaction cost is the future.
Great video!
Thank you, Manuel!
Anything you'd like to see next?
Always learning so much from you -- thanks for this content. You mentioned Georgia *not* being ideal for setting up an e-comm biz. I know that Georgia is becoming popular w/Digital Nomads, and the country seems to be promoting ease-of-biz setups (esp. "online" "virtual svc", apps etc). Would love to hear your thoughts re: strategy for a U.S. citizen planning to spend 6+ months in Georgia, who does a mix of e-comm type biz (dropshipping, affiliate mktg, Low Content Self-Publishing, etc). Thanks!