{"id":12802,"date":"2025-06-16T15:43:32","date_gmt":"2025-06-16T12:43:32","guid":{"rendered":"https:\/\/gls-law.company\/?p=12802"},"modified":"2025-06-16T15:43:35","modified_gmt":"2025-06-16T12:43:35","slug":"investing-as-an-individual-why-it-s-costly-and-inconvenient","status":"publish","type":"post","link":"https:\/\/gls-law.company\/en\/investing-as-an-individual-why-it-s-costly-and-inconvenient\/","title":{"rendered":"Investing as an Individual: Why It\u2019s Costly and Inconvenient"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">Many entrepreneurs start investing in their personal name: buying stocks, launching startups, holding crypto on exchanges. It seems logical \u2014 until reality hits: taxes, risks, and restrictions.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In this article, we explain why investing as an individual is often inefficient and risky, especially if you\u2019re playing the long game.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>1. Tax Burden<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">An individual typically pays:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>18% personal income tax + 1.5% military levy in Ukraine,<\/li>\n\n\n\n<li>or up to 45% in countries with progressive tax scales (France, Spain, Portugal).<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">In addition, international income may be subject to double taxation. If you&#8217;re a tax resident of two countries, and both claim taxation rights on your income \u2014 proving otherwise can be challenging.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>2. Repatriation Issues<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">When you sell an asset or receive dividends as an individual, it&#8217;s hard to:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>legally transfer the income to another account,<\/li>\n\n\n\n<li>reinvest it,<\/li>\n\n\n\n<li>avoid repatriation taxes (which can reach 15\u201335%).<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">With an investment company structure, earnings stay within the entity and can be reinvested without additional taxation.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>3. Reputational and Banking Restrictions<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Brokers, banks, and crypto exchanges are increasingly scrutinizing the origin of funds. An individual investor without a legal structure might:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>fail compliance checks (especially in the US or EU),<\/li>\n\n\n\n<li>be unable to open accounts for active trading or investment operations.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Companies with clear structures, licenses, or regulation are treated more seriously.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>4. Lack of Asset Protection<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In the case of lawsuits, tax disputes, or financial difficulties, personal investments:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>may be frozen,<\/li>\n\n\n\n<li>are not shielded from creditors,<\/li>\n\n\n\n<li>become part of personal liability.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">A company allows you to separate assets and limit risk exposure.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>5. Complex Reporting Requirements<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">An individual is required to:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>file annual tax returns,<\/li>\n\n\n\n<li>keep records of all transactions (even thousands),<\/li>\n\n\n\n<li>justify currency differences, asset valuations, and the origin of each deposit.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Companies follow different accounting standards, which are often simpler \u2014 especially in Estonia or Cyprus.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Conclusion:<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u274c Investing as an individual is only easy in the early stages.<br>\u2705 For long-term activity, asset protection, and tax optimization, it\u2019s better to build a structure right away: an investment company or a fund.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In upcoming articles, we\u2019ll cover:<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u2013 how to minimize taxes through investment companies,<br>\u2013 why up to 35% of dividend income may be lost,<br>\u2013 and how to avoid repatriation tax.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Many entrepreneurs start investing in their personal name: buying stocks, launching startups, holding crypto on exchanges. It seems logical \u2014 until reality hits: taxes, risks, and restrictions. In this article, we explain why investing as an individual is often inefficient and risky, especially if you\u2019re playing the long game. 1. Tax Burden An individual typically [&hellip;]<\/p>\n","protected":false},"author":4,"featured_media":12791,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_uf_show_specific_survey":0,"_uf_disable_surveys":false,"footnotes":""},"categories":[241],"tags":[],"class_list":["post-12802","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investments"],"_links":{"self":[{"href":"https:\/\/gls-law.company\/en\/wp-json\/wp\/v2\/posts\/12802","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/gls-law.company\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/gls-law.company\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/gls-law.company\/en\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/gls-law.company\/en\/wp-json\/wp\/v2\/comments?post=12802"}],"version-history":[{"count":1,"href":"https:\/\/gls-law.company\/en\/wp-json\/wp\/v2\/posts\/12802\/revisions"}],"predecessor-version":[{"id":12803,"href":"https:\/\/gls-law.company\/en\/wp-json\/wp\/v2\/posts\/12802\/revisions\/12803"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/gls-law.company\/en\/wp-json\/wp\/v2\/media\/12791"}],"wp:attachment":[{"href":"https:\/\/gls-law.company\/en\/wp-json\/wp\/v2\/media?parent=12802"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/gls-law.company\/en\/wp-json\/wp\/v2\/categories?post=12802"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/gls-law.company\/en\/wp-json\/wp\/v2\/tags?post=12802"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}