Corporate Income Tax

Corporate income tax is charged on the profits of a company. Where it applies depends on where the company is resident, which usually means where it is managed, and on whether it has a permanent establishment somewhere else.

The range is wide: 21 % federal in the United States, 25 % in the United Kingdom, 30 % in Australia, 9 % in the UAE and none in the Cayman Islands or the Bahamas. Estonia charges tax only when profits are distributed. A US LLC with a non-resident owner and no US business pays no US corporate tax, although it still has to file Form 5472. Hong Kong, Singapore and Georgia exempt foreign-source income under conditions. Large groups with revenue of EUR 750 million or more also face the global minimum tax of 15 % (OECD Pillar Two); owner-run companies are not affected.

Where a company counts as resident depends on the country. The United States looks at where it was incorporated. The United Kingdom, Canada and Australia also look at where it is managed and controlled: a company registered in Delaware but run from a laptop in London can be treated as a UK company.

That is why Flag Theory 3.0 ties the business flag to the residency flag. Your company can only be free where you are not taxable on its profits, and where nobody can claim that you manage it from their territory.

Controlled foreign company rules add a second layer: some residency countries tax the undistributed profits of your foreign company as if they were your income.

Which combination of company and residency delivers a real, defensible result for your business is what we design in your Sovereign Blueprint, never a company in isolation.