Where do I start with a company I own in another country?
With the entity, not the income. Before any figure is useful you need to know what the company is treated as for US purposes, because a corporation, a partnership and a disregarded entity produce different reporting and different timing on the very same profit. That conclusion comes out of the constitutional documents, the ownership register and the liability position of the owners. Everything else follows from it: the reporting package, whether profits are taxed to you as they arise, whether foreign tax can be credited. Starting with last year's profit and working backwards is how owners end up filing on the wrong basis.
What documents do I need before anyone can advise me?
The incorporation documents and constitution, the ownership register with the date of every change, the statutory financial statements for the years in question, the company's own returns and assessments, and a list of every dealing between you and the company: salary, dividends, loans in either direction, rent, anything at all. Dates matter more than amounts at this stage, because classification and the timing rules both turn on when things happened. If the company has had other owners, or has changed its legal form, bring that history too. It often explains why the current treatment is not the obvious one.
Should I sort the company out before or after my personal return?
Before, because the personal return depends on it. The company's classification decides what your return has to show and when, so a personal filing prepared first is a guess that may have to be corrected. Where time is short, the order that causes least damage is to establish the classification, file on that basis, and leave refinements for later. What does not work is filing the personal return on the assumption that nothing is reportable until money comes out, then discovering the company should have been in the return from the year it was incorporated.
I set the company up years ago and reported nothing, what now?
Establish the years first. Work out from the ownership register when your interest reached the level that brings reporting, then identify for each year since whether a filing was required and what it would have shown. That schedule is the whole basis of what follows, including which route to use for bringing the years in. The other half is the tax, and often the company's profits produce little or no US tax once the credits are constructed properly, which changes what you are dealing with. Fix the years and the figures before choosing how to file them.
Do I need to do anything before the company's next year end?
Often yes, and that is the main argument for starting early. An election about classification is time-sensitive, and how profits are taken out, whether as salary, dividend or loan repayment, is a decision made during the year rather than repaired afterwards. Once a year end has passed the facts are fixed and the work becomes reporting what happened. So the first conversation is worth having while there is still a year to shape: the same arrangement that is straightforward if settled in advance can be expensive to replicate once the transactions have gone through the books.
Is it simpler to just close the company and bill clients personally?
Sometimes, and it is a fair question to ask early rather than after years of reporting. But closing a company is itself a taxable event in its own country and usually on the US side as well, and the two may treat the wind-up differently, so the cost of leaving has to be set against the cost of staying. There are also non-tax reasons the company exists: contracts, licences, local clients. The right order is to price both paths, including the reporting each involves, before assuming the simpler structure is the cheaper one.
How many days can I spend in a country before I become tax resident?
It depends on the country, and a day count is only ever the start. Many use a threshold in a tax year, some also look at averages across several years, and some have no day test at all and decide on where your home and life are. Two countries can both conclude you are resident, which is what the treaty tie-breaker exists to settle. Counting days without checking the tie-breaker is how people end up filing as resident nowhere. See the residency tie-breaker.
Can an accountant in one country file my return in another?
Yes, where they are authorised to represent you with that tax authority and the filing is done electronically. What matters is not where the adviser sits but whether they can lawfully act for you and are competent in both systems — a return prepared with no knowledge of the other country is where the relief gets missed. We file on both sides, from offices in India, the USA, Canada and the UAE. See how we work.
