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bigduckontax
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 3914
Experience:  FCCA FCMA CGMA ACIS
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I do affiliate marketing and online ecommerce selling

Customer Question

Hi I do affiliate marketing and online ecommerce selling physical goods online and digital products.
I haven't registered a business as yet but I was able to earn $10,000 last month and I am now ready to optimise my campaigns and scale to my target of earning to $100,000 a month which is going to be relevantly easy as I have now found the formula to marketing and selling online.
Plus I have a day job earning around £35,000 a year as I'm in sales which can change depend upon me achieving my target or not. At this stage I haven't decided to give up my day job because I still enjoy what I am doing plus I am able to do my online business in the evenings.
So inorder for me to pay the least amount of tax on my earning?
Can I use a trust to save tax?
Register my business in Isle of Man as a non resident? (Just something I read online)
What should I do? As I dint want to get a massive tax bill once I've pushed the button...
Thanks
Jermaine
Submitted: 10 months ago.
Category: Tax
Expert:  bigduckontax replied 10 months ago.

Hello Jermaine, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question.

My immediate reaction would be to set up a company to operate your new selling business. These days, within the EU, the UK's low Corporation Tax rate of 20% makes this country a tax haven. On any profits only tax at 20% would be levied.

Operating in the Isle of Man, the Channel Islands or even Gibraltar has its low tax rate attractions. However, operating there is big business and with local directors and compliance the costs may make the game not worth the candle. It is all right for the big boys like Amazon and Vodafone, but not cost effective for smaller schemes. At the level of involvement you propose, say $1,200,000 pa, you definitely require financial and administrative support from a local, trusted professional.

You could reduce exposure to IT by using some of you profits up to K pa to fund a private pension fund which would reduce your tax bill somewhat. Currently the limit isK pa.

I do hope that you have found my suggestions of some assistance.

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