Bitcoin Forum

As we know, binance now requires verification.

All this time, a friend of mine, uses his own name to save partnership money.

So he and his friends have a business together but the money is in name of John.

Binance recently requires account verification. If one day Binance reports the money to tax authority, the tax authority may think it's his money even though it's partnership money.


My friend wants to incorporate somewhere and then open binance account, not bank account, with his incorporation address.

What does he actually need? Does he need just corporation?

Which jurisdiction is best?

Which service should be the way to go?

He controls the binance account, with password, 2 factor and so on. The purpose of the corporation is so that in case one day binance reports ownership of money, binance will correctly report that the money is own in a corporation instead of by John.

2018 guide How to Apply for Corporate Account
https://www.binance.com/en-AU/support/faq/360015552032

If your friend manages the partnership money then yes, your friend should open a Binance corporate account. The assumption is that the tax costs will be shared and adjusted accordingly.

Your friend should consult a tax advisor. My only thought is that there is no best but appropriate, jurisdiction will follow where your friend lives as an asset manager or as a holding company.

Binance provides a tax API feature (https://www.binance.com/en/support/faq/538e05e2fd394c489b4cf89e92c55f70) that you can use for self-tax reports. It is possible that this feature will be available for corporate accounts and may have different settings.

Okay. Anyone has been doing this?

Anyone did this for the purpose of tax avoidance?

Corporation jurisdiction is tax free jurisdiction.

Are you sure about this? Corporate taxes are the highest among others as far as I know but it depends on which country you are living.

If you aren't using the corporate account then the tax will be reported to the one person who manages the money no matter its for a company or a partnership and all these things are available in their terms itself.

If you already submitted your documents for the personal account then it cannot be used for corporate account.

I've never been this far.

Binance explained that it was likely unavoidable.

Even if you do, there will be consequences according to local regulations.
It is possible that binance will side with the tax authorities if you commit a violation and hand over all your crypto holding information.

If the business is based in Seychelles, the taxation will be zero but for Seychelles. Meaning that the company will not pay taxes there either to any other country (since it's not based / registered there). Of course, the money will be there and any "anonymity" for the shareholders depends (firstly) on the structure / articles of association of the company.
Now when and if you want to move the money (and I talk about fiat, not crypto), then you will have to check the tax regulations for the country you want to "enter" the funds. Eg, there are countries that want 15% for remittances, others 20%, etc.

P.S: You will also need to know if the person that will be receiving the amount (if it's a personal bank account) can "justify" it somehow...

It's not a tax, just a withdrawal fee. In Indonesia, the tax policy on crypto ownership has not been regulated despite several plans. What I believe is that the government has only imposed taxes indirectly, maybe the tax has been taken from stock exchange withdrawal fees which will be reported by the exchanges itself collectively. cmiiw

If you or your friends are worried about taxation, then ignore this section, because you are here to be someone who obeys regulations.
Of course, with bitcoin abilities you can freely "disguise" your bitcoin holdings. And if so, why are you looking for a tax-friendly jurisdiction? After all, in the end the crypto tax will apply in all countries.

So you mean you want to save some money from tax and you want to find some ways to lessen what you supposed to pay to your government? Well if your country strictly implement the taxation on crypto then maybe you cannot do anything but to follow what they require to their citizen and its hard not to follow them since I'm sure you know the consequences for not paying tax right? So if I where you just follow what is written on your laws to avoid any conflicts in future.

I think you shouldn't be keeping your corporate money in binance, unless it is strictly necessary.

You should buy a hardware wallet such as ledger or trezor (the best 2 of the market)  and withdrawal your incorporation funds to that newly created wallet.

Your money will now be under your (or your friend) custody, not under binance control. You don't need to prove anything to binance anymore.

you should only keep funds in exchanges when trading (buying or selling). Do not hold your funds there.

Binance may freeze your account some day if authorities request, they may also get hacked, face regulations problems and so on. You don't need to be exposed to that risk.

I get where this is going, so as it stands the account is under the guise of being a sole trader and is accessed by more than one person but this shouldn't  be a big problem when it come to upgrading the account to being a cooperate account which will protect your friend(s) from any potential tax liability but I would suggest have to open a new account to separate any personal binance trading from the partnership trading account.



The best people to talk to are Binance themselves as they will guide Mr John with facts and right way of going about this. Just avoid pseudo names when something goes wrong it's a tedious process to resolve.

+1

Exactly.. Dont know on why people are really that obsessed on dealing off with things which do really end up for them not able to have the full control of their coins.As long you do entrusted those funds

on a centralized platform or you dont actually have possessed the keys and would be much better if you do store it up on a cold storage and just pull off those funds needed for trading just
like on what you had suggested on.

Making an exchange platform as a main storage is never been a good thing or ideal thing to do but there were some situations where you do really need to
done such thing but well its your choice.

What is your country? Taxes imposed on commercial activities are higher than individuals, and tax systems differ from one country to another.
He must stop using his personal account for business activity and open another account, and if he has not verified the identity, they will not be able to find out the money.
If he does, the taxes will be lower and you start setting up a business account.

That's odd that any government right now wouldn't have some sort of tax or regulatory policy regarding cryptocurrency.  It's not like bitcoin was introduced to the world a few months ago--governments have had over a decade to figure out how they're going to deal with its existence.

I agree with all of that.  Sounds like a somewhat complicated situation OP's described--and I'd also second the opinion of those who advised OP's friend not to use Binance like a bank.  This is crypto we're talking about, not fiat, and while Binance might be the most reputable exchange out there, there's no telling what could happen with them or any other exchange.  It's far better to control your own bitcoin (or whatever coin) using wallets that you yourself control.