Foreign Companies and taxes.if you own a company in another country ,what taxes will be due on earnings?

Oldman answered one year ago …

To set up a company overseas involves a lot of business expenses for licences, tax withholding and accounting in that country, especially if it has a Tax Treaty with the U.S., plus account fees at a foreign bank for conducting currency and product payments, insurance and ongoing regional and national taxes.

In the developed European Nations, the corporate tax rate is slightly higher than that of the U.S., about 40%. You'd need to read instructions for Schedule C, and the tax regulations on "Foreign Earned Income for U.S. residents". Now, to your advantage, you'd have a ton of deductible business expenses, including travel, and all those fees you paid to set up the business, to deduct on the Misc. Bus. Expenses of the 1040 Tax form...which would probably make you liable for paying AMT, rather than straight Income Tax.

Most states charge their taxes based upon your income, and only some allow deductions based upon the Federal Form. A few have no income tax, but may charge intangible and real property tax on anything that is held for income, regardless of where it may be held.

In addition, may countries tax inventories of materials, components, and stock held for sale, but not yet sold...including tax havens, which have no income taxes. That's why so many shipping companies pay outsized dividends at the end of their corporate year, to get the "profits" off their books, sort of like a 'year end inventory sale' in those states that do have this kind of tax.