For years, PewDiePie has been subject to controversies. This time, the Swedish YouTube star is reportedly trying to dodge his taxes by migrating his UK company, PewDie UK Limited, to Nicosia, Cyprus.
As initially reported by Input Magazine, PewDiePie has been the sole director of his company since April 2019. Pewds, whose real name is Felix Kjellberg, appointed two additional Cyprus-based directors Andreas Menelaou and Kseniia Milevska. The two provided "a correspondence address in Nicosia, Cyprus, to Companies House, the UK's register of companies," the reports reveal.
Why Cyprus? "The island of Cyprus has been transformed into an international financial center as a result of its excellent geographical location, tax incentives, and high standard of living," the company's website explains.
Pewds Dodge Tax Obligation?
Many experts suggested this move as a way for Pewds to dodge his tax obligation legally, as Cyprus has a lower rate of corporation tax than the UK, a country where Pewds is based now. Pewds settled with his now-wife, Marzia, to Brighton in 2013.
From a tax perspective, the UK's broad general rule is that companies are automatically subject to the tax, which stands at 19%. Meanwhile, in Cyprus, corporation tax is "only" 12,5%.
"If the decisions, the overall management, and strategic decisions are conducted outside the UK, you can migrate that company outside the UK for tax purposes, and therefore the UK lets go of it and corporation tax," Nimesh Shah, CEO of Blick Rothenberg, a London-based accounting, tax, and advisory practice, told the Magazine.
Pewds is not the first and definitely wouldn't be the last high profile person to practice such an act. Many would try to keep it as quiet as possible as, even though it's legal, it can damage their reputation if it's twisted in a negative light.
Money in the Bank
According to Forbes, PewDiePie earned a whopping $15 million. He was crowned as the second highest-earning gamer in the world after fellow YouTube and Twitch star Michael' Ninja' Blevins, who led the pack with $17 million annually.
However, PewDiePie's numbers are still far from Ryan Kaji, the world's current highest-paid YouTuber, who amassed over $22 million and $26 million from his videos and product advertisement respectively in 2018 and 2019.
In 2015, the Swedish tax authorities hit the YouTuber with a £9,000 fine after he mistakenly excluded profits from his production company in his 2013 tax return. Pewds also once told his viewers that he intended to relocate to Japan with Marzia but is still looking to see how taxes and visas work in the Land of the Rising Sun.
Taxes suck," says Jordi van den Bussche, a popular YouTuber known as Kwebbelkop. "If you're young, you're flourishing, making an insane amount of money and think you're on top of the world, and then the taxman says: 'That's going to be 40 percent or 30 percent or 20 percent,' that can be a pretty heavy hit if you don't know anything about it."
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