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  • #988568
    mrlb
    Member
    • Total posts: 2
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    Hi there,

    I’ve been doing some research on the internet and in the forums here and I’ve been struggling to find the info I’m looking for so I decided to make this post for direction.

    I have developed a prototype product that I will be launching to a global market via Kickstarter USA. I am currently looking for some advice around how I can structure my business for liability /assets protection and reduce my tax liability.

    Some background about me is I am an Australian citizen & I have currently spent $70K of my personal savings on R&D within Australia. My product will be manufactured, assembled, programmed, tested, and packaged in China.

    I have a requirement to spend a lot of my time in Shenzhen, China to*project manage the*manufacturing etc. I am looking to have a company setup in Hong Kong in order to build a contact base in the manufacturing & trade. The Hong Kong company would coordinate/pay the manufacturers in local currency from the sales made through kickstarter and also coordinate trading / shipping direct from the region. Though I will spend time in Asia I will still remain an Australian resident in order to pay my marginal tax rate should I pay myself an income from HK.

    To be applicable for Kickstarter USA I am required to have a company in USA. I would be looking at setting up a corporation there that has an legal agreement with HK company to provide a service for managing the kickstarter campaign and handling the funds for a service fee.

    As for the Australian side of things I am unsure if I need to have an Australian company and whether I will be liable to pay tax on the profits made from the HK company. I have read that there is an active income test for*controlled foreign corporations that must be passed by showing the company has less than 5% tainted income, in order to be exempt for Australian tax.

    On the note of having an Australian company. I am uncertain if this is necessary or required. however I am aware there is a tax rebate available for R&D, 41 cents in the dollar. Since all my electrical and industrial design partners located here I thought have the company presence here may be beneficial. There is also the upside of purchasing assets and acquiring loans.

    I was wondering if there is anyone in these forums that has done what I am trying to do or if anyone has any experience in structuring such businesses. If the issue is too complex then I will seek out to hire a mentor/expert from the ‘Need a resource’ section.

    Thanks in advance.

    #1167791
    Dave Gillen – Former FS Concierge
    Keymaster
    • Total posts: 2,566
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    Hi there,

    You’re right – your issue does sound a little involved, so might be better suited to getting professional advice, but you never know who’s lurking around here so good luck!

    I just want to welcome you to the forums. :) See you around.

    Dave

    #1167792
    mrlb
    Member
    • Total posts: 2
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    FS Forum Support, post: 194501 wrote:
    Hi there,

    You’re right – your issue does sound a little involved, so might be better suited to getting professional advice, but you never know who’s lurking around here so good luck!

    I just want to welcome you to the forums. :) See you around.

    Dave

    Thank you for the warm welcoming and congratulations of running a valuable site.

    As for an update, I am currently seeking legal advice for the USA / Kick-starter service company and also Australian legal advice regarding CFC in HK.

    However it’s always good to hear from the horses mouth where possible so I am definitely keen to see if they are any smart cookies lurking :)

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