Living Tax-Free as an Affiliate Marketer (Part II)
The first step in living tax-free as an affiliate marketer is to create your offshore business. The most effective structure is typically a company formed in a zero-tax jurisdiction. Nevis, Belize, Panama, and the Cook Islands are the top choices for online businesses.
If you want to put on some asset protection, you can create a Panama foundation or trust as the host. This will deliver maximum protection from future civil creditors.
One word of advice about Panama
The directors and officers of Panama businesses are public record and listed in a searchable database. The same goes for council members and trustees of a Panama foundation.
Affiliate marketers usually want privacy to reduce the possibility of a lawsuit. So, you may add an LLC from Nevis or Belize to the mix. You are the CEO of the LLC and the LLC is the founder, officer, or director of your structure. This way, only you and your banker know who the beneficial owner of the company is.
The second step is to open a merchant account and an offshore bank account for your web business. Your clients or affiliate networks have to be paying by wire transfer into this account.
Clients typically look to Panama, St. Vincent, Cook Islands, or Belize for this account. The most well-known offshore jurisdiction with affiliate networks is in Hong Kong and Panama. The issue with this is that both of these jurisdictions now oblige you to have legal residency before opening a business bank account.
If you can’t get money into an offshore bank account, then you’ll have to have a US corporation. You want this business to bill the customer and then relocate the profit to your offshore account. The US business bills the client and you bill the US company so that it breaks even at year’s end.