Change to Ownership Overseas



There is a misunderstanding as to what type of businesses the U.S. provides tax deferral overseas. Is it a trading company or a company dealing in capital overseas? The fact is that the U.S. provides tax deferral on overseas trading businesses but not on overseas firms dealing in capital.

Your foreign company needs a legal basis for a tax deferral structure that is not effectively connected to the USA and is a foreign resident. The Foreign Account Tax Compliance Act (FATCA) does not define the difference between trade and capital.

You need a foreign company to collect commission, receive your contract buyout and to collect any payments in order to get paid gross rather than suffering current tax. You need a Tax Department Certificate to the effect that your foreign company has residency in that foreign country for Double Taxation Treaty purposes. Your foreign resident company also needs to be owned by your foreign resident registered IRC 402(b).

Therefore, our first step is to organize your business ownership, command and control, to be a tax recognized resident in a Hong Kong 402(b) foreign retirement plan.


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