Quote:
Originally Posted by Mutt
This is what I assumed is what's done. But doesn't the IRS or CRA in Canada see through that and make you defend what exactly these 'consultancy services' are and who is providing them?
My best friend comes from a fairly wealthy family, him and his sisters when they were young adults would get paid from the dad's company a couple grand a month. They didn't do any work. I wasn't jealous or envious, not in my nature to be that way BUT I could never understand how the taxman never investigated and I think the company was audited once.
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"Create" whatever expense you feel is necessary. Have all your servers in the Panama company and rent them out to your US business at a steep price and keep the profit in the Panama company. Create licensing fees, royalties and other things.
About being paid from a company and never doing any work, that's absolutely legal. It's up to the companyto decide if your work is good enough to keep you hired. The tax man does not investigate exactly how much, if at all, you actually work. They look at your declared income, if you are paying taxes on that, then everything's fine in their eyes.