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» Once the company has been formed there are two main ways of making it function:
• The company issues invoices from its seat in the country of incorporation
• The company asks a person of confidence to open a representation office in another country where a good part of the real and representative activity is scheduled to take place. This can be accomplished as follows:
• A representational office (ie no commercial activity) which does not normally require any administrative approval
• A registered branch office. This branch office may open a local bank account (sometimes considered to be a ‘non-resident’ account) in the name of the mother company. Providing the branch office can prove that it has declared all its activities in the mother country’s jurisdiction, it is normally not necessary to make any fiscal declaration in the branch office jurisdiction.
» In both cases it is normal, but not an obligation, that the nominated representative be remunerated either with a (locally-declared) salary or by fee.
Naturally the representative will declare his earnings as part of his annual personal tax declaration. This does not of course exclude earnings made outside of his country of domiciliation.
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