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Hello. My specialty is focusing on YOUR Financial needs. Financial Planner/Business Owner for 20 years. CPA,PFS,QFP,GMMA.
Open an account overseas (not in the US). You can keep the euro's there.
Buy the euro's and simply store them someplace safe.
Also consider a CC. they will tranlate to american dollars.
As to NY state, if the work is NT poerformed there then there is nothing due NY (from the business). of course YOU may have to pay state income tax as a resident.
Thank you Shawn:
I am looking to open the account overseas, but it is turning into nightmare. Almost every country I have contacted is asking for some residency connection to it to open such an account. For example, there is Citi Bank in UK, but when you call them, they say you have to be a resident of UK. The same for Austria etc. If you know of any Europian country I can open the account as a US citizen, please recomend it to me.
I am sorry I did not understand the suggestion about "CC".
You have said: "Also consider a CC. they will tranlate to american dollars"
What do you mean here?
As far as NY sales tax: Let's assume the account in euros is overseas. I need to issue the receipt to the customer. The receipt needs to be from my company registered in NY. On the receipt will be amount of approximately 30,000 euros ( 10% of that amount is my commission). How would you write that receipt? Would you just break it like 27,000 euros- cruise, 3000 euros -commission....and can the receipt be in euros? I am sorry but I am totaly confused about this part ...
a CC is a credit card.
You understand the part about the receipt perfectly. the receipt CAN be in Euros.
Have you thought about retaining a law firm or an accounting firm to open the account on your behalf?
If this does not answer your question please let me know. Also let me know if you have additional questions. This is my full time job and I only get paid if you accept my answer. We work on the trust system at JA. If you understand my answer and have no more questions, please ACCEPT and please leave positive feedback (if so inclined). Thank you.
CCs would not work since the owners of the yachts want only wire transfer (CCs have an option for disputes and refund which owners do not want to risk)
Now, I assume on the receipt would then be just amounts for services and then at the bottom I would add 10% VAT (which is European tax) ...correct?
What if, for example, the american customer wants to pay me in dollars and wants me to arrange wire transfer in euros for him/her. Let's assume I issue to the customer a receipt in US dollars and I receive the money from the customer to my US bank. The money then goes out from my US dollar business account in NY to the owner of the yacht in Europe. Would then the receipt be subject to NY sales tax of 8.875%?
If the answer to that is yes, then would the whole amount be subject to sales tax or just my commission? I understand that on my commission I will pay income tax wherever I have the account in the world, so that is clear to me. However, I really do not understand this whole situation with NY sales tax, and if it is applicable, then on which part of the receipt it would apply (since I would retain only my commission, not the whole amount on the receipt)?
I am looking for the other firms to open the account for me. Right now the only option that might be availble is to open the escrow account somewhere in Europe. The problem I am trying to figure out right now is that I want to be in control of that account since that is the only way I can really protect my customers (common thing in the industry is to collect half of the money upfront, then just before the charter to collect the second half, and when customers arrive to the yacht to release the money.
I am the only one that should control that situation and escrow account...hmm....I still do not know the answer to that issue)
Yes you can simply add VAT.
Not since the work waqs done outside NY. The only NY work you did was billing.
Again working through an attorney (there will be a cost) who is ethically and legally obligated to follow your instructions or risk "disbarrment" should work just fine.
If this does not answer your question please let me know. Also let me know if you have additional questions.
This is my full time job and I only get paid if you accept my answer. We work on the trust system at JA.
If you understand my answer and have no more questions, please accept and please eave positive feedback (if so inclined). Thank you.
Ok, I understand now the VAT and law firm. Thank you for that information.
I still have the issue with following:
" Not since the work waqs done outside NY. The only NY work you did was billing."
When I called the NYState to ask this question, the one representative said to me:
" Regardless that the work was done outside of NY, you are collecting the money in NY and therefore you should be adding NY sales tax to your receipt." Then she added: " In addition, if any of the item on the receipt is state taxable, the whole amount on the receipt becomes state taxable"
The second NY State representative I spoke to said he thinks I am exempt in this case. Completely opposite answers....
Now, about the income tax.... If I make the money in euros, how is that taxed on my yearly income tax. I mean, there are currency fluctuations. How does that work? Is it going by figuring out the bracket I fall under and the numbers are converted on the date I file tax return or...?
Ok Shawn, thank you :)
Just before I click on Accept Answer and give you a very positive feedback, please just once again ( to heal my insecurity) confirm to me that even I actually have registered company in NY State and have the US address there and am collecting the money in NY and keeping my commission there, there is nothing on that receipt that I should apply NY State tax on since the yachts are in Europe and I am currently living outside of US so bookings are also happening outside of NY.
I do not know if she got it wrong, but I was keep explaining it to her and she was just repeating the same answer on everything I would say. However, she definitely made me nervous in regards XXXXX XXXXX matter :)
Thank you Shawn for being so patient with me. I am relieved now. I would definitely give you excellent feedback and if I ever need help in future, I would be really happy to work with you again.
Shawn..I am back to you again..:) I am calling all these banks these days and researching my options, but I do have a question for you in a meantime.
If I collect for example 20 000 euros on my euro account in Europe and I keep for example 3000 as my commission and I forward the rest of 17 000 to the owner of the yacht..Isn't it that if I open the account in London, UK could see that 20 000 euros as something I should owe taxes on even I am not the resident there and I do not have the company there, but just bank account with a balance? Do you know which country in Europe would be the country where that money could be collected and forwarded with some minimal taxes?
there should be no taxation as you are simply BANKING there.
Great...I did not know that "banking only" is excluded from taxation. Is it then that if you are the resident, then taxation would apply?
No. The fact that you bank has nothing to do with taxation.
For example if your dad died and you received 1,000,000 from life insurance that money is tax free. depositing it means nothing.
If I gave you 100 for your birthday or Christmas as a gift and you deposit my check would you expect to pay tax on that?
I hope i explained it a bit better so you understand.
Yes. The first comparison...brrr....do not want to think about that.
The second one, I would not mind receiving that gift at all :)
Little joke, but I do understand what you mean.
Thank you again.