The accelerator Latitud launched on Tuesday (1st) the Latitud Go, a technology to facilitate and cheapen the processes of opening a company, attracting investments and exiting operations. According to Neofeed, the idea is to help small entrepreneurs adjust to bureaucracy and legally save on tax payments. The service promises to reduce the cost to one-fifth of what would otherwise be spent.
- Sales startup for neighborhood markets receives BRL 25.4 million
- Entrepreneurship podcasts: see suggestions from five Brazilian executives
The company was created by American Brian Requarth, co-founder and former CEO of VivaReal, a real estate classifieds startup that was sold to OLX in 2020 for R$2.9 billion. The current business grew out of that story. At the time, Requarth says he could have skipped spending $100 million, which came out of his pocket to pay fines for a legal failure.
Latitud Go reduces legal costs with partner law firms and an offshore tax collection scheme at lower rates. The structure is divided into three parts: an intermediary holding company in Delaware (USA); another in the tax haven of the Cayman Islands; and an operation in Latin America.
Feedly: subscribe to our RSS feed and don't miss any Canaltech content on your favorite news aggregator.
“We are not reinventing the wheel. This whole process is already known, but it costs something around US$ 30,000 initially. We were able to reduce that cost to something close to $6,000 using technology,” Requarth told Neofeed. For now, the service is aimed at startups. It was tested in August and already has 15 customers.
Is offshore illegal?
Brazilian law allows an individual to own an offshore company and not collect taxes from our country, as long as it does not distribute profit to its partners or does not bring money back to Brazil. Another requirement is that the company be opened with resources duly declared in the Brazilian income tax.
While it is not illegal to maintain an offshore company, secrecy and lenient tax rules are resources that facilitate illicit activities such as money laundering and tax evasion. This was the case of the journalistic investigation called Pandora Papers, which analyzed more than 11 million documents from the Panamanian law firm Mossack Fonseca, now defunct – and which had as clients the Minister of Economy, Paulo Guedes, and the president of the Central Bank, Roberto Neto Fields.
Read the article on Canaltech.
Trending on Canaltech:
- PFF2 or N95 mask: you may be using it wrong
- Scientists discover unprecedented type of neuronal communication in the brain
- Why is the Moon moving away from Earth
- Galaxy S20 FE vs iPhone SE | Which is better in 2022?
- Man spends 80 days eating raw meat and records experiment on Instagram