New York LLC
New York is the centre of commerce and one of the most important financial centres in the world. It is therefore a prestigious location with good image.
The chief attraction of the New York LLC is that its owners gain complete protection against liability for company obligations as with a corporation and yet they receive partnership tax treatment. Income and gains are attributed directly to the members and not to the corporation itself.
The owners of a New York LLC are called "members". Members are similar to the shareholders of a Corporation. The members may exercise direct control over the New York LLC, according to their individual percentage of ownership, or may appoint one or more "managers". If managers are used, they perform functions commonly associated with corporate secretaries and directors. The manager can be a trust or a corporate body if required.
Not usually recognised as a tax haven jurisdiction. It is ideal for holding companies or trading companies. Since the LLC (Limited Liability Company) is taxed as partnership then as long as there is no trading in the US or source of income or any expenses in the US or member resident in the US for tax purposes the company can be structured to avoid charge to US taxation.
- Limited liability protection for the members
- Can avoid paying any taxes in the US, unlike corporations which are taxed on their worldwide income
- Members and Managers need not be resident
Avoiding US Taxes
The use of a New York LLC creates exciting tax planning opportunities for the international community, when all four of the following requirements are met:
- The members are neither citizens nor residents of the US.
- The New York LLC does not engage in a trade or business within the US.
- The New York LLC does not have an office or other fixed place of business within the US. It can however use a mail forwarding service.
- The New York LLC does not earn an income in the US.
The profits generated by a non-resident LLC are not taxed in the United States. Ownership of the LLC should be established in a tax-free or low tax jurisdiction.
|Corporate legislation source||Chapter 34 of the New York State Consolidated Laws.|
|Company status||Limited Liability Companies (LLC)|
|Usual minimum capital||None|
|Company name||Prior approval required, some names sensitive|
|Time taken to incorporate||2-3 weeks|
|Availability of shelf companies||Yes|