Starting an LLC: Where to begin?
in Business, Accounting & Taxes ·
I could use a little guidance here—here’s the situation:
There is a chance I'll have to change my employment setup with my current employer (an overseas firm);
basically, I would need to set up my own LLC instead of being an employee. I'd bill them monthly for services like marketing or market brokerage, totaling my current gross salary plus some extras, like car expenses or home office rent...
On the commercial side, I wouldn't be handling imports, procurement, or sales to third parties; it would just be one or two invoices sent abroad for my professional services.
Let's say we're looking at $4,000 a month. That puts me well over the threshold for mandatory sales tax registration, but I don't see how that actually hits me. Does sales tax apply to those $4,000 payments?
I know I'd account for office rent and utilities, but I'd essentially pay myself a minimum owner's draw, cover my accountant and standard payroll taxes, and then potentially pull out additional funds via business expense reimbursements. Anything left over stays in the business account until the end of the fiscal year, at which point it's distributed as a dividend subject to a 20% tax.
Does this plan hold water, 🙂 or am I missing something obvious?
There is a chance I'll have to change my employment setup with my current employer (an overseas firm);
basically, I would need to set up my own LLC instead of being an employee. I'd bill them monthly for services like marketing or market brokerage, totaling my current gross salary plus some extras, like car expenses or home office rent...
On the commercial side, I wouldn't be handling imports, procurement, or sales to third parties; it would just be one or two invoices sent abroad for my professional services.
Let's say we're looking at $4,000 a month. That puts me well over the threshold for mandatory sales tax registration, but I don't see how that actually hits me. Does sales tax apply to those $4,000 payments?
I know I'd account for office rent and utilities, but I'd essentially pay myself a minimum owner's draw, cover my accountant and standard payroll taxes, and then potentially pull out additional funds via business expense reimbursements. Anything left over stays in the business account until the end of the fiscal year, at which point it's distributed as a dividend subject to a 20% tax.
Does this plan hold water, 🙂 or am I missing something obvious?