Starting a business - basic ?'s before I start going down rabbit holes

[Big Swifty]

Greetings,

I'll try to make this brief while including the most relevant information.

I'm a US citizen, currently a resident of Perú where I've been living for 9 years. My wife is Peruana, but currently living in Argentina with her brothers, parents, and nephews, with status ranging from citizens to residents to in the process of obtaining residence.

Hopefull in the next couple of months, I can join my wife. I understand there are curretnly pauses on restrictions on entry for family reunification. Let's just assume all of that and every other Migracionés situation gets resolved by the time I try to enter because my question is related to running a business.

I had a business here in Perú, but I want to pursue something slightly different once I get to Argentina. Work as something of a digital nomad performing a service which can be entirely done online. All of my clients would be in the US, Europe, or Australia. Wouldn't be earning a single peso in Argentina. At first I wouldn't even consider hiring anyone in Argentina, and if/when that time came I might prefer to use the services of an independent contractor. Not my question for today. Not talking about a great amount of revenue, since I'd be outsourcing my services to people who expect to pay less than they would normally in the US. I'm estimating mid-five figures per year.

Cutting to the chase and eliminating some details, am I correct in assuming that compared to eventually creating an LLC myself in Argentina once I have residence, or having my wife do it now/soon in her name, that it's better tax wise and less hassle filled in general for me to register an LLC in the US? A US registered business, with (primarily) US clients, depositing US currency into my business account at a US bank, with the only Argentine variable being I as the owner/sole employee would be living in and working online from Argentina.

I understand the differences between how Argentina treats US dollars compared to other countries. Both my brother in laws are financially savy and have told me how it's important to have a bank account outside the country, and have suggested that my working for overseas clients and getting paid in dollars is a good thing. That those dollars could be converted to crypto which has far less regulations/restrictions/fees when ultimately being converted to pesos to cover living expenses.

Of course, there are any number of variables, such as including my wife as an owner, or having her as an employee (she may actually actively contribute, tbd). I am very flexible and may be doing some occasional side work in the US. Border hops for visa renewal is an option. For now I'm trying to get a general idea of where to structure this LLC so that I know where to focus my further research efforts.

The usual goals of business apply - one of which being minimizing tax obligations of revenues. Also looking to keep things as simple as possible re: paperwork, minimizing beurocratic headaches, etc.

I appreciate any thoughts, suggestions, observations at all, whether it's something I asked about directly or something I don't appear to have taken into account.

 

[Alfred_Arnold]

Unless your clients are Argies and needing to pay pesos to an arg bank account with a transfer or arg debit/credit card, I do not recommend you pursue incorporating here. You would be a monotributista and have strict limits on deposit and withdrawal justification. You or your wife, i believe, would need a DNI to obtain a CUIT or CUIL to be able to register as a monotributista.

If you are doing remote digital nomad business, I would incorporate in the US instead. If you think border hops are required for your stay, I would incorporate in the US instead.

 

[MilHojas]

Unfolded companies: they sell from Uruguay and collect dollars, they leave part of the staff in Argentina and pay in pesos

Firms that export technology go en masse to that country seeking for tax advantages and to avoid exchange restrictions in Argentina

www.iproup.com

 

[dsp27]

Assuming you will seek residence in Argentina, if whatever business activity you plan to pursue has no Argentine-source income you maybe be able to avoid taxes in Argentina by not declaring it and fly under the radar especially if we are talking 50k/year (this can become borderline tax evasion if you are not careful). The issue is that Argentina has no double-taxation avoidance treaties with most countries and as a US citizen you must pay taxes on your global income. You need to consult a good accountant on this. I am not.
Taxes and digital nomads and now with Covid and teletrabajo and people based in one country and working in another is creating a lot of confusion and I am sure it will be a big issue over the coming years. As long as there is no movement of big sums of money and you are are paying taxes somewhere, where the majority of you business activities is, you'd be fine. Now this is just my totally unprofessional opinion and the AFIP might think otherwise. But I have plenty of friends digital nomads who work here and some are even citizens and they do not file taxes here because their income source is based outside. of Argentina....

 

[Fiscal]

What kind of digital work?

 

[Big Swifty]

Thanks for all the informative responses. I appreciate the info.

I'd be working as a photo editor. I worked as a photographer in Perú, and generally speaking half of the process is post production. For various reasons, some related to the rate of pay in Argentina, I'd rather focus exclusively on post-production for other photographers, most of whom would be from the US, the rest from Europe or Australia.

There won't be any Argentine clients. One because the type of photography I specialize in isn't a thing in S. America, and second because I know I can earn more from abroad and in currency more stable than pesos that can be kept out of Argentine banks. Seems like a no brainer.

I understand the basics of the US taxing global income of it's citizens. I'm of the mind that if I'm paying the US govt. taxes on my income, LLC registration fees to a state, etc, then I'd rather not have to pay the same taxes to Argentina, or any other country. I figure Argentina will tax me on my consumption at 21%. Seems fair to me. Tax my income where I earn, tax my consumption where and when I spend and contribute to the local economy.

I've always been a big fan of flying under the proverbial radar. That 50k a year figure is pretty much exactly what I'm estimating right now. Not enough to be a big deal in the US, but enough to provide a decent living in Argentina. I have residence in Perú but never took the steps to obtain citizenship. I could go either way in Argentina as far as apply for residence or just do the old fashioned border hop. One of my brother in laws would like for me to rep his alpaca clothing line at trade shows in the US about twice a year for a month each, so once the pandemic calms down there should be plenty of opportunities to leave and return. Until then I'm fine with a quick trip to a nearby country if necessary.

No plans to move large sums of money around. Family tells me it's best to leave savings in the US and though I have no experience, I'm aware of the inflation issues. As long as my wife has an account or I can transfer to a family member I don't even really care about having a bank account. I'm fine converting $US to crypto and then using that in Argentina to convert to pesos/pay for expenses. The only thing I could imagine moving a decent amount of money for would be to buy a car; something modest and built in Argentina. By that time I might be going to the US infrequently anyway and could bring back the 10k limit in cash to convert using dolar blue.

Reassuring to hear of others working in Argentina but their source of income being outside of Argentina and having no problems. I had a feeling things would be like this, but didn't want to get out over my skis and like hearing confirming voices of experience. Lot of informality in Perú and no one would ever know I was working from home for out of country clients who were also paying me directly outside of the country so reasonable to assume it's the same there. The big advantage I can see here is that nobody other than the bank is going to restrict how many dollars I withdrawl using my debit card, but necessity is the mother of invention.

One other thing I'm curious about are the numerous tax services marketed toward expats. Wondering if I should just stick with a US service to do business taxes and my personal taxes while they're at it, or if it would be better to use one of these expat services. And if so, are there any recommendations as far as who's good and who to avoid? Or is it not really necessary since all of my income will be generated in the US and I'd just be paying more for a specialist service?

Thanks again for the resonses. Looking forward to eventually making it there for the change of scenery and culture after nine years here.

 

[lunar]

I'd be working as a photo editor. ... Tax my income where I earn, tax my consumption where and when I spend and contribute to the local economy.

You earn your income where you are clicking the buttons, not where your customers are paying you, and not where the company that pays you is located.

 

[dsp27]

Also be aware that visa runs might not be an option for a long time. Even before the pandemic some people were having issues. So...

 

[Alpinista]

You earn your income where you are clicking the buttons, not where your customers are paying you, and not where the company that pays you is located.

You are certainly right. In theory.

 

[Big Swifty]

Also be aware that visa runs might not be an option for a long time. Even before the pandemic some people were having issues. So...

Thanks for the visa run warning. Pretty sure I'd rather just try for residency anyway, but good to know. Used to be an option here in Perú , but then they changed it to only 180 days maximum per year.