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Tax Engineering

Offshore e-Commerce

E-commerce is the biggest innovation of the 21st century and is one of the main pillars of many countries' economy. Thanks to e-commerce, companies and entrepreneurs can sell their services or products all over the world without leaving their offices. E-commerce has caused the modification of tax laws in many countries since it is difficult to determine where a company is operating physically and what taxes it should pay. Today registering an offshore company for e-commerce is not a complicated task and is a very beneficial option to save taxes and delay the payment of them. That is to say, a company can sell a non-tangible service in Europe or the United States without being present in the country physically, but through a company and bank account opened in Hong Kong the company could receive the money from sales and make purchases with a single click. In this particular case, in reference to taxes, the Hong Kong government will not consider the company as a resident if it does not carry out activities on its territory involving local companies or individuals. As a result the company will not pay any tax if it complies with these conditions.

Types of E-Commerce  

E-commerce can be classified into 2 types. On one hand there is an e-commerce of tangible products and on other hand e-commerce of intangible products. Depending on the type of e-commerce carried out by a company, it will be easier or more difficult for tax authorities to identify whether corporate taxes should be paid or not.  

E-commerce of intangible products 

It is the type of e-commerce that gives most headaches to the tax authorities since it is very difficult to determine where the company is operating, where the director is residing fiscally and to where the goods are sent. In the e-commerce of intangible products there is no physical delivery of a product to a customer and everything is done online. That is, the client will receive his service by email or on the screen of his computer. There is no way to know in which country the company operates physically.

E-commerce of tangible products  

The e-commerce of tangible products is also done online but the only difference is that there is a shipment of a physical product to a specific country, from and to a particular address. Therefore the tax authorities can determine the location of a company by transport agencies. For example, depending on where you are storing the product before shipping them, the tax agencies could determine whether the company operates in one or another country. However, this can be complicated if the company makes dropshipping and sends the product from tax haven even though its country of registration is a high tax country. 

In this section of frequently asked questions the client will know all the secrets of e-commerce, the ways to make payments, receive payments and the appropriate steps to expand his business online complying with all tax laws of his country of residence.

What is a virtual POS terminal?

An offshore virtual POS is used to charge debit and credit cards websites or by phone outside the country of residence of the beneficial owner or the country of registration of the company with the corresponding tax savings. Depending on the type of business, the offshore payment gateway can be considered low risk, such as a book sale, or high risk business, such as a travel agency, pharmacy, and casino business.

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Charge customers from Peru by PayPal

Yes, you can open an offshore bank account in any country to accept PayPal payments. Keep in mind that PayPal has many restrictions and you will have to find a country where PayPal also operates. Greetings

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What is an offshore hosting?

The offshore hosting servers are located outside the country of residence of the owner of an online business to avoid any problems of licensing, legality or formalities that governments submit to online businesses. Offshore hosting can be located in tax havens or in high tax countries. As in finance, servers located in tax havens will have greater opacity than those of a high taxation country, since as a general rule the owner of offshore hosting will not be resident in the country and will have more favorable laws than in his country of residence. When an individual hires an offshore hosting he has to take into account the country's internet communications and technology to avoid any type of errors generated in the transmission of data.

Offshore hosti

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What is a Chargeback or Reversed transaction?

A chargeback can be defined as a monetary claim to a virtual POS or merchant made by the financial institution that issued a debit or credit card. Chargebacks can be fraudulent or legitimate. That is to say, an individual who has made a purchase with his credit or debit card can request a chargeback claiming that the transaction was fraudulent. The aim of this request in not to pay for the purchase made with his card. The client can claim before the issuer of his credit card, that he did not make the purchase or he can argue any minimum defect of the product or service purchased with the objective of receiving the money back. The situation when the customer claims that he has not made the purchase can be avoided by using 3D Secure anti-fraud security pr

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Offshore software development

An offshore software developer is a programmer specialized in php, C, or C+ programming languages and who works outside the country where the company or individual who has contracted their services is registered.

The offshore software developers are usually autonomous. They are also known in the world of programming as "Freelance". However, we can also find serious companies with very large programmer templates. The best countries to hire offshore software developers are: Armenia, Russia, Ukraine, Romania, Bulgaria, Hungary, Latvia, Czech Republic and Slovakia. The worst countries to hire software developers would be India, China, the Philippines, Pakistan and Indonesia.


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