Should affiliates form a company?

[ambergambler]

Allow me to revive this topic, for that I need to ask a few questions and I might as well do it here. I need to form a company, as the Swiss government would not allow me to register here as a self-employed freelancer, once they took a look at the nature of the website.

There's a lot of confusion on what how, where, and as much as I tried to explain the nature of the business with no mentioning of the G word, people are simply confused on how things work online and the laws are very vague apparently about it as well.

From what I understood, Malta would be the place where an affiliate website/webmaster would be in their legal right to register a company? I'd have to present an employed contract for my 1 man company too, which seems quite silly but that's what my lawyer told me. I really wanted to set up a self-employment here, but the word illegal was used so now that's my only option to "legalize" something that isn't illegal in the 1st place.

Would I'd have to get myself a ticket and visit Malta, or can this be done at a distance. Not that it matters, but I'm on time limit, and the quicker everything can move the better and easier for me would be to set everything up.

I'd appreciate any input that would put me in the right direction, as it's a bit confusing for me.

Grüezi wohl

What Triple7 says is correct. I just have a few things to add as a Maltese resident running affiliate sites on a self-employed basis, but looking to open a company here.

If you do open a Maltese company, it might make sense to wait to see what tax rates you would pay as a B2C gaming company. The Malta Gaming Authority are streamlining their rules right now so depending on what transpires, it might be worthwhile registering the company as a gaming affiliate to take advantage of some tax goodies. Maybe open a Maltese company now and when the new legislation comes into force, decide whether to register as a gaming company.

In terms of substance, you might need a director in Malta to prove the company is being run from there. And then you fly over for a board meeting every six months.

Lastly, Malta is on holiday now until last week of September, and nothing will happen before then in terms of lawyers or government departments. Even the supermarket shelves are looking empty by now - just so you don't have any nasty surprises.

If you have a need for speed, how about an Isle of Man company? or (complicated solution, but maybe tax-friendly) how about you form a company in CH which owns the one in Malta, which runs the affiliate? You could open the CH one down in Schwyz or Zug and pay the super-low tax, and pay the 5% Maltese tax after the refund system. Or is that too complicated? Probably it is. But long-term, could be worth looking at.

[Moonlight Cat]

People running "offshore" companies to dodge paying tax while still wanting to enjoy their first world lifestyle in their home country are the worst kind of selfish.

This is not a problem of these people. This is state problem. If people run to offshore these means only one: "Something wrong in your tax system". Decrease taxes, - and people go back. That's all.

[TravG]

If you are making any kind of real money I would. I started an LLC so I could keep my personal and business assets separate. If you start to amass a decent personal net worth you want to protect it. If you run everything through your personal accounts (payments, invoices ect.) you have no protection should something go wrong. Really not sure what ever would, but you never know.

[xecutable]

Grüezi wohl

What Triple7 says is correct. I just have a few things to add as a Maltese resident running affiliate sites on a self-employed basis, but looking to open a company here.

If you do open a Maltese company, it might make sense to wait to see what tax rates you would pay as a B2C gaming company. The Malta Gaming Authority are streamlining their rules right now so depending on what transpires, it might be worthwhile registering the company as a gaming affiliate to take advantage of some tax goodies. Maybe open a Maltese company now and when the new legislation comes into force, decide whether to register as a gaming company.

In terms of substance, you might need a director in Malta to prove the company is being run from there. And then you fly over for a board meeting every six months.

Lastly, Malta is on holiday now until last week of September, and nothing will happen before then in terms of lawyers or government departments. Even the supermarket shelves are looking empty by now - just so you don't have any nasty surprises.

If you have a need for speed, how about an Isle of Man company? or (complicated solution, but maybe tax-friendly) how about you form a company in CH which owns the one in Malta, which runs the affiliate? You could open the CH one down in Schwyz or Zug and pay the super-low tax, and pay the 5% Maltese tax after the refund system. Or is that too complicated? Probably it is. But long-term, could be worth looking at.

Grüezi ), that's the word I hear around here all the time. Thanks for the clarification and the input from both of you. Indeed it sounds complicated, as I've never had to deal with it. Until now I've been let to be self-employed without any obstacles, and I thought it would be the same here, but surprise!!! .

Basically the choice I'm given at the moment is to block Switzerland, which I did and then pay for some sort of an audit from Comlot which is the gambling commission, to make sure that I wont ever take a Swiss player to a foreign bookmaker. As if a .co.uk domain and being hosted in the UK focused on the UK sports and leagues isn't enough.

The other is to incorporate abroad, and just show a contract of employment, which would save me invoices, bank statements, etc etc to prove to the AHV I'm really self-employed. I think they also wanted a business plan, though I've been doing this for 8 years.

Taxes don't scare me, as long as I'm not asked to do something crazy, as the first lawyer firm that I contacted wanted me to create an AG, with at least 100,000 CHF liquid and deposit 50,000 of those. I did explain, I'm just a single person, and don't pull such numbers to agree on such thing.

Bottom line is, I want it to be presentful in front of the Swiss AHV, legal and not just technically legal, while looking shady-ish.

[Triple7]

I think there are three options:

1. Let them audit. I see here casinos operating without a license, but they block Romanian IP's. You should take both formal and technical actions, like no .ch-domains, block Swiss ip's, no Swiss servers and make an I/O-order with the affiliate programs that you are not referring any residents of Switzerland to their websites. Perhaps it's also better to have a bank account outside CH, but I don't know how heavy they want to play the game.

2. Open a company in Malta/Isle of Man/Gibraltar/Curacao/etc. and play the open card with the Swiss tax department. In most countries, they will consider it as a local business, because it has no substance in Malta/Isla of Man/Gibraltar/Curacao/etc. File your taxes in Switzerland. They might be ok with that. Perhaps just some formal requirements exist, like having a local dependence or Chamber of Commerce-registration. Most likely Malta will exchange details anyway.

3. Same as 3, but create some substance in Malta/Isle of Man/Gibraltar/Curacao, hence appoint a director over there and let them process payments and invoice over there. Like AmberGambler wrote, also organize some board meetings. The shareholder can be your to open Swiss company. This is giving you in Malta the opportunity to use their tax credit system. Depending on the tax system in Switzerland you can invoice your Maltese company or pay out the dividend, costs your making, board meeting presence, etc.

For sure a GMBH in Switzerland has a requirement of less than 100,000 CHF.

I would ask a gambling specialized lawyer in Switzerland (for example Simon Planzer, http://www.planzer-law.ch/en/service...s-of-practice/) ) about options. Any option will cost money anyway. The audit, no idea what it costs, but opening a Maltese company, appointing a director, processing payments there, isn't free neither.

[Triple7]

If you are making any kind of real money I would. I started an LLC so I could keep my personal and business assets separate. If you start to amass a decent personal net worth you want to protect it. If you run everything through your personal accounts (payments, invoices ect.) you have no protection should something go wrong. Really not sure what ever would, but you never know.

Plenty of things can happen, like for example a claim because of not complying to copyright stuff, gambling laws, etc. But also personally something can happen. If you've put everything together a personal problem will also affect your company assets.

I would always keep things separated in this business and I would always organize things well in a company. Not playing around with a Skrill-card or something and not declaring anything where you should declare it.

[Cash Bonus]

Hello folks,

I believe that the parties involved certainly need to be able to work together and to get involved in working out what works best for them and also, work on how they can improve on things and also, be able to introduce new things into the market that will help them out and also, set a good example to other people in the business too. They need to always have certain plans put in place just in case of failure of a certain plan or plans and they also need to have a good backup system that is always fully functional and in place, too. If there's anything that you would like to add to this, I would like to hear it from you, please.

[vd752]

I see here casinos operating without a license, but they block Romanian IP's.

Sorry, is it possible to operate legally from Romania, form a SRL there, etc? (don't mean Romanian market or local licensed casinos)

[xecutable]

Thanks for the link Triple7. I've sent him a message asking for a quote. I'd gladly pay for an opinion that's specialized in our industry.

I'll give it a green light for them to audit it and see if no precious swiss player can find me on page 99 on google.ch on a .co.uk domain . I'd gladly spend money as long as it's going to work, and allow me to get my permit in a timely manner.

Paying rent on a place, where you no longer live, just because you are on a standby here, isn't convenient either, for me or my girlfriend.

[Triple7]

Sorry, is it possible to operate legally from Romania, form a SRL there, etc? (don't mean Romanian market or local licensed casinos)

Yes, as long as you're not breaking the Romanian law.

[kylelaurens]

I also formed an LLC, at some level of income you should do it for tax purposes. And as others said, you can deduct business expenses then.

[elgoog]

Hello folks,

I believe that the parties involved certainly need to be able to work together and to get involved in working out what works best for them and also, work on how they can improve on things and also, be able to introduce new things into the market that will help them out and also, set a good example to other people in the business too. They need to always have certain plans put in place just in case of failure of a certain plan or plans and they also need to have a good backup system that is always fully functional and in place, too. If there's anything that you would like to add to this, I would like to hear it from you, please.

makes no sense

[Cash Bonus]

It makes perfect sense.

[Triple7]

I am toying with the idea of setting up a cheap St Vincent company where there is no tax and no bookkeeping. I just wonder if this is too dodgy a location for the casinos to pay to..

Most casinos won't care where you have your company. But, if you're having a company in St. Vincent and live in a European country, they might make a problem of that, because the company is run from the country you're living and not from St. Vincent if it doesn't have any substance over there. Also, good luck with opening a decent bank account.

[bonusfriend]

I think you should run it as a company, if you are making enough to do it full time.

The the most important thing for me is a don't want any trouble accessing money earned from the country i live in.

I m prepared to pay a little more tax long term to avoid all sort of legal problems. The sort of problems that might arrive setting up operations in low tax regions.

It's probably a question of how much risk you want to expose yourself to, when choosing location of company/companies and the place where you will physically will be located.

[casino.guru]

I think you should run it as a company, if you are making enough to do it full time.

The the most important thing for me is a don't want any trouble accessing money earned from the country i live in.

What about following idea:
- you have 1 company in the country where you live
- you have an offshore company which collects money from partner programs
- you invoice from your local company to the offshore company to get money home. You pay taxes locally.

Then the question is: what jurisdiction would be the best for operating the company which "runs your websites and collects money"?
...for a worldwide affiliate operating in multiple countries around the world with "changing" gambling legislation.

[Triple7]

UK or Malta I think. Not very far if you live in Europe, not heavily taxed, easy to open a company, able to get bank accounts with your company, etc.

[Simseen]

Depends on local laws and the size of your affiliate business. In Denmark you should registre as a company if you except to earn over 50.000 dkk (Around $8.000) in a 12-month period.

I already got a company i also use for my freelance business, so i just put the affiliate earnings through there.

But if you reach a certain size i'll create a company for the affiliate, that way it's easier to pay freelancer, do taxes, employ people, and general make a real business out of it.