Minimizing Your Taxes and Managing Your Complex Affairs

Tax Tips, Finance Tips, Fun Events

Tips for Individuals, Businesses and Charities. Fun Events.

Does Your Business Deal With Customers in Multiple Countries?

In today’s economy, many businesses have customers throughout the world.

Having customers in foreign countries exposes you to many risks. Does your organization have procedures to deal with foreign risk management issues?

Here are some common risks you may face:

TAX ISSUES

  •   Are foreign clients paying your business and deducting foreign nonresident withholding from their home countries? If yes, are expected fees grossed up or is your company eating these taxes or filing tax returns in these jurisdictions to try to obtain refunds?

  • Even if your company doesn’t have an office in foreign countries, you may have employees on frequent business trips or local representatives that creates a taxable permanent establishment.

CURRENCY RESTRICTIONS

  • Are profits trapped within certain locales (such as China) due to currency restrictions? If yes, how will you repatriate your funds?

  • Are there hedges in place for countries where currency rates fluctuate or are at risk for devaluation (such as Venezuela)?

GLOBAL MOBILITY ISSUES

Even if your company doesn’t have employees in foreign countries, you may have employees on frequent business trips to visit foreign customers.

  • ·To attract talent from competitors, benefits (including tax protection and tax equalization plans) may create employees with excessive costs and thereby reduce the company’s margins.

  • Does the company offer kidnap & ransom (K&R) insurance? Many U.S. executives are targets for a burgeoning kidnap and ransom industry. [FYI: Movie tip: Proof of Life starring Meg Ryan and Russell Crowe prominently have K&R insurance in the film.]

https://www.richardponcpa.com/business-tax-expertise/

 

If you are enjoying my tax and finance tips and would like to buy me a beverage

https://www.paypal.me/richardponcpatip

Richard Pon CPA, CFP