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Are foreign personal holding companies subject to US tax?

Pittsburgh, PA |

I am a foreigner working in the US, and I currently own a holding company in Singapore. It's closest to a C-corporation (taxed separately from owners), and I own all the shares. Is this company subject to US capital gains tax, personal income tax, or personal holding company tax?

Attorney Answers 4


Good question: not so complex after getting through some more details.

I am going to guess that "closest to a C-corporation" means that this is a private limited company in Singapore. My other guess is that this is a holding company that is the legal owner of various investment vehicles, both passive and active. Is that correct?

Next, you asked about several kinds of US tax:

1. US capital gains tax. This will depend on the nature of the activities of the SG holding company and whether you are realizing capital gains (I realize this is stating the obvious). This will also depend on the filings you make with the IRS this year and the nature of your status in the US as a foreign worker.

2. Personal income tax. This depends on where you receive the personal income. Are you still drawing a salary, management fees, or contractor fees from your holding company while you are in the US? If so, this may trigger personal income tax liability if not properly structures.

3. Personal holding company tax. The undistributed personal holding company may indeed become an issue as well. With proper structuring, you may also reduce the impact of this potentially painful tax liability.

If you are liable to double taxation, (depending on your income) it would be well worth your time, effort, and money to properly structure the payments you will receive from your Singapore holding company. Because SG and the US do not have a traditional double tax agreement, you will need to come up with a better strategy than simply taking a gain or salary from the SG holding company.

I think you are headed in the right direction because you are asking the right questions. With a little more detail, a lawyer could help you structure your tax position. After creating a viable and reasonable structure, you can then work with a tax adviser to implement your compliance activities to reduce compliance costs and risks.

I hope this response has been helpful. With the right information, you can avoid some potential international tax pitfalls that surround your US presence (residence?) and you Singapore holding company.

Portage Bay Law PLLC is an international law firm that give companies doing global business the knowledge and confidence they need to comply in any country. Our answers on this site do not constitute legal advice, nor do they establish an attorney-client relationship. The only thing that can do that is a signed Engagement Letter and Fee Agreement, which you can get by contacting us through

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This is a question that will be answered under business tax or income tax, or tax not business or corporation

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All depends on whether the entity has effectively connected incoen to the U.S. And whether there is a tax treaty in place between Singapore and US. This is a very complex and fact intensive question that is beyond what you can expect to get on Avvo. You need to speak with a tax lawyer withninternational experience or a CPA and deiscuss your overall personal and business structure to hope to obtain good answers to your questions posed.

My answer is not intended to be giving legal advice and this topic can be a complex area where the advice of a licensed attorney in your State should be obtained.

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There is not enough informait0on to give a specific answer but it does not appear the corp will owe tax here. Need more information. You need a tax representative to prepare your taxes.

I cannot be responsible for your case until such time as I am in an attorney-client relationship with you. To do so, I require a written Fee Agreement so you know the fees I would charge to handle your case. I can represent you before the IRS if you retain me as I am a licensed attorney and can represent taxpayers from any state.

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