‘AINA Law Office (AILO) is committed to helping Small medium & Big size entrepreneurs, Business owners to start, manage and growth your business with peace of mind at an affordable price.
Designing and formalizing a favorable business structure is important to ensure that your business is not overwhelmed by excessive compliance obligations and the structure is tax efficient. We will determine what structure best meets your needs, establish the structure including company incorporation or branch registration.
A foreign company looking to establish a business presence in USA may choose to operate in the USA by registering a new US company or alternatively operate as a Branch and register the foreign company. The preferred structure will depend on the investor’s particular facts and circumstances. Some points you need to consider are:
Commercial perception: Compared to a branch, an US company may be perceived as a more permanent form of presence and a larger commitment to doing business in US. Local customers and clients may in some instance be more comfortable knowing that there is an US entity involved.
Liability: An US company is a distinct legal entity and separate from its investors. One key advantage of an incorporated company is that it has a limited liability. A branch on the other hand is an extension of the foreign parent operating in US. The liability of a branch extends to its parent.
Taxation: A company and a branch are subject to the same income tax rate. However, the major issue with a branch lies in determining what its Foreign taxable income is. Operating via a company eliminates income and expenditure allocation issues that are generally associated with a branch structure. An investor also needs to consider what structure best suits them from their home country tax point.
Exit: A company has to go through a formal process to wind up operations. The winding up process is relatively straightforward for a company that is not operational at the time of winding up and does not have any assets or liabilities. A branch does not have to go through a winding up process. It can cease operations and close.
Our aim is to educate the Business entrepreneur on the legal and regulatory requirements and be a partner throughout the entire business lifecycle, offering support to the company at every stage to make sure they are compliant and continually growing.
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