Digital Marketing Agency Est. in USA & DAFT

[heatherfarris]

I have a question about the DAFT business formation in the Netherlands.

 

I was reading this on an immigration attorney's website: 

 

Quote

As a result of the Friendship Treaty between America and the Netherlands, it is considerably easier for American entrepreneurs to obtain a residence permit as an independent entrepreneur. The most important conditions are that a company must actually be started and registered with the trade register of the Chamber of Commerce. A significant capital of at least € 4,500 must also be invested in your own company.

My question is this — My company is very established here in the US. I am an employee of my company. I’m taxed as an S-Corp here and run my pay through a payroll service. 

 

Am I able to register part of my business there and deposit the € 4,500 required and maintain the main business formation and in the US?

 

I'm an LLC taxed in the US under an S-Corp. I would like to move to the Netherlands with my family for a few years but maintain my business operations in the United States. All of our clients are US clients. Since I don't speak dutch I wouldn't actively be seeking dutch marketing clients so our operations & client base will remain in the US.

 

As the owner of the company though I would like to move and do my work in the Netherlands and live there with my family.

 

I have read some on the business.gov.nl website that I may be able to register as a foreign company such as an LLC from the US. I just want to know what my legal and tax obligations will be before making our final decision to move on the DAFT opportunity or if I have to use a different visa option entirely.

 

Essentially it comes down to this... Can I maintain my business formation in the US, pay my business taxes in the USA and pay my personal income taxes in the Netherlands while filing returns in both locations?

 

Business -- taxed in the United States

Personal -- taxed in the Netherlands

 

If doing this am I still eligible to apply for the DAFT?

Thank you,

Heather

27 juli 2022 aangepast door heatherfarris

[Joost Rietveld]

Hi Heather

 

Welcome to the forum.

 

To answer your rather specific situation requires a lot of detailed knowledge of the DAFT, the US-Dutch tax treaty and US taxes.

 

Under normal circumstances taxes are due where the management of the corporation is residing, unless a tax treaty stipulates otherwise or (usually) unless the company in the country of origin remains substantial enough to be marked as a branche office.

 

That's about as far as my knowledge on the matter goes.

 

Issues that might arise in your case:

- is your US company substantial enough without you residing in the US.

- does the IRS have any issues that you are taking a salary whilst not residing, and thus not working, in the US?

- what visa do you need to start a company in NL

- how does that affect your US taxes (the arms of the IRS are long).

 

You could start by calling the government: Dutch immigration services: https://ind.nl/en/service-contact/contact-with-ind

 

Best of luck

[heatherfarris]

Joost, 

 

I really appreciate your response. I have sought out the assistance of a few attorneys but I will also take a look at contacting the IND directly. Not being versed in legal language or tax law I think a lawyer may be the best first line for questioning.

 

Thank you again!

 

Heather

[Joost Rietveld]

Dutch government agencies are usually very helpful, also in avoiding the law lingo, and answering you in English. Give it a try