Offshore app development in Singapore

[sz1a]

Hello,

I am an app developer/entrepreneur who currently lives all over the world. I am close to releasing a paid app on the Google Play Store and need do decide where I will register my android merchant account. This comes with a slew taxation problems.

Here's the catch: I am a Swedish citizen but have lived outside Sweden for the past 6 years and am considered expatriated in the national census. If I register an android merchant account in Sweden my income has to be sent to a Swedish bank account. This comes with a heavy tax burden.

However, I do have a Singaporean bank account in my name as well.

Scenario: I could register an android merchant account in Singapore in my own name and use either my local bank (or my friend's office) as address and specify my Singaporean bank account as receiver of funds. My income from app sales would be from all over the world. Singapore does not tax income generated overseas by foreigners banking but not living in Singapore.

Question: How would taxes apply for an individual bank account holder in Singapore in this case? Does the fact that I specify a local Singapore address for the android merchant account violate the non-resident/not in Singapore clause for income tax even though I don't live there? A "non-resident" LLC is a better solution for the long term for liability reasons but I want to see sales performance before moving into something like that.

Your thoughts are MUCH appricated. Thanks!

[taxico]

as you're on you way to becoming a billionaire, i strongly recommend paying an accountant familiar with singapore's taxation system a small sum of money to help you get the results you want, including setting up your company locally. it is not expensive, and many companies offer such services (as your company's local agent/rep).

your questions are (i think) on the brink of asking people help you avoid taxes. i understand most governments don't like that, and they regularly send tax dodgers to prison.

if you're gonna do it, do it the right way the first time.

http://www.ecitizen.gov.sg/Pages/NonResidents.aspx
http://www.acra.gov.sg
http://www.iras.gov.sg
http://www.enterpriseone.gov.sg/

http://www.enterpriseone.gov.sg/Topics/ ... esses.aspx
http://www.enterpriseone.gov.sg/en/Busi ... gners.aspx

[sz1a]

Thanks for the answer taxico. I am not intending to dodge taxes but my current situation actually makes it hard to determine who should receive them. I agree about incorporating in SG however and the benefits that come with it, but read on for something odd about taxes:

1. For the purpose of receiving payments from Google it is perfectly fine to register as a merchant in the country of preference/ where you bank. It is a simple wire. You pay taxes where you live and do your business from irregardless of where you bank.

2. There is no double taxation issue with Sweden (got this confirmed by tax authorities) or most other places for that matter, if you are fully expatriated with no ties to the country in your passport (like a wife or property or similar). You should always pay taxes where you live, not where you bank.

3. Same as #2 goes for Singapore or anywhere else. Simply having a bank account that receives funds doesn't mean you will pay taxes in that country. You pay taxes where you live.

4. As an aside, incorporating in Singapore is great for limiting liability, lower tax rates and a very business friendly country overall. No one invests in a one man show obviously but keep reading for an odd finding:

The funny thing is what happens when you don't incorporate anywhere but simply receive income at your various accounts while being fully expatriated and living a few months at a time in different countries. It is entirely doable if you earn things like ad revenue from websites and apps or sell digital content online. If you are fully expatriated, it means you pay taxes to.. no one.

And: no one is able to legally claim taxes from you either since you are not a resident anywhere. So no angry governments in your way, just a lot of frequent flying and relocating.

[taxico]

as i'm not an up and coming app billionaire, i didn't actually read through what you've typed because it's too confusing for me.

accountants (not a tax attorney) in singapore are not expensive to seek advice from. i think ~$500 will get you all the advice you need.

with all the ability to receive payments, i'm sure you can wire some to a legitimate accountant familiar with all the questions you want answered.

p/s: i made my first (8) million $ in 1995 as a teenager in singapore during the dot com hey days.

instead of plowing through a stack of IRAS and RCB papers and asking myself WHAT WOULD I DO IF...

i scraped some money together before i was paid by selling off my two prized road bicycles (a colnago and a trek) and a cell phone (motorola something or other) for cheap.

i then brought $475 to an accountant (in Bishan) and $1,299 to a lawyer (in People's Park Complex) to handle all the paper work as i was under-aged and did not own a single share in my dot com directly.

i found the lawyer in the yellow pages, the paper kind. the young accountant was a friend of a friend, but a newly minted CPA.

my question to them was: ARE YOU EXTREMELY FAMILIAR WITH TAXATION LAWS OF SINGAPORE AND THE USA? NO? i dialed the next lawyer's number. YES? i don't have a lot of money, will you take me on as a client? etc...

my instructions to them were simple: minimize my tax exposure legitimately (i have dual citizenship) and make sure the bank doesn't steal my money. IMO, they accomplished it.

so if it worked for me, it will work for you.

www.yellowpages.com.sg

www.lawsoc.org.sg

www.icpas.org.sg

[JR8]

3. You pay taxes where you live ...

Which is the rationale behind this floating tax-haven!

http://en.wikipedia.org/wiki/MS_The_World