Tax Planning
We work under a close relationship with the operation of our clients, performing an analysis of their financial situation and designing tools from a tax perspective to ensure effective planning.
Being able to structure both for individuals and for different business entities, tax planning allows us to evaluate the financial and operational profile in each case, aiming at the minimization of its tax burden, optimizing accounting and financial policies, and determining the circumstances adaptable to such purposes.
Likewise, proper planning allows them to identify compliance with the duties of a formal and material nature in the position of the taxpayer, taxpayer of the tax obligation. All this applied to the operations of the entity, whether local or international.
LUKRUM HUB’s tax specialist offers you tax advice in areas such:
• Tax Planning Strategies
• International Taxation
• Transfer Pricing
• Tax Treaties Analysis


International Taxation
Multinational corporations generally operate abroad through foreign subsidiaries that are mostly tax as independent corporate entities. This system of separate entities gives incentives to multinationals to change reported profits to their affiliates in low tax jurisdictions by underestimating sales to them and excessive price purchases.
For tax purposes, most governments require that firms use a “mutual independence” standard, setting prices for transactions within the corporate group (“transfer prices”) equal to the prices that would prevail if the transactions were between independent entities. However, there is ample scope for companies to manipulate transfer prices, especially for intangible assets, such as the company’s exclusive patents and for which there is no easily established market price.
In LUKRUM HUB you will find proper advice to accomplish your goals of expanding business to or from USA.
Transfer Pricing
Our services range from conducting basic searches for comparable companies (“comp searches”) for benchmarking purposes too complex transfer pricing issues (e.g., ip migration, dispute resolution, restructuring, start-ups, etc.)
U.S. transfer pricing
Our services include the preparation of U.S. transfer pricing documentation as provisioned in §§ 482 and 1.6662-6 of the U.S. Treasury Regulations:
“Principal Documents” as stated in § 1.6662-6(d) intercompany transfer of tangible property (e.g., distribution, retail) intercompany services (e.g., management, procurement, financial, engineering, etc.) intercompany transfer of intangible property (e.g., royalty payments, cost sharing agreements)


Tax Treaty Analysis
The United States has income tax treaties with a number of foreign countries. Under these treaties, residents (not necessarily citizens) of foreign countries may be eligible to be taxed at a reduced rate or exempt from U.S. income taxes on certain items of income they receive from sources within the United States. These reduced rates and exemptions vary among countries and specific items of income.
Residency for treaty purposes is determined by the applicable treaty.
If you are treated as a resident of a foreign country under a tax treaty, and not treated as a resident of the United States under the treaty (i.e., not a dual resident), you are treated as a nonresident alien in figuring your U.S. income tax. For purposes other than figuring your tax, you will be treated as a U.S. resident. For example, the rules discussed here do not affect your residency time periods to determine if you are a resident alien or nonresident alien during a tax year.
If you are a resident of both the United States and another country under each country’s tax laws, you are a dual resident taxpayer. If you are a dual resident taxpayer, you can still claim the benefits under an income tax treaty. The income tax treaty between the two countries must contain a provision that provides for resolution of conflicting claims of residence.
Finance
Financial Accounting could be perceived as a tool which allow us to have a vision of the financial position of your company at a given time; Facilitates timely decision-making and allows you to develop a financial plan according to your resources.
At LUKRUM HUB, we offer our specialized knowledge in the provision of financial services for various types of industries, adjusted to your specifically needs.
We focus to provide: … Good
Preparation of Financial Statements and Accounting
Financial statements is a photograph of a company at certain period. There show financial position in the course of comparative periods, or in their absence to a specific date.
The analysis of financial statements is the critical process aimed at assessing the financial position, present and past, and the results of operations of a company, with the primary objective of establishing the best estimates and possible predictions about future conditions and results.
The material expression of its accounting, it’s visualized through its financial statements, which must be prepared in accordance with the Accounting Principles and General Acceptance in the United States or USGAAP, those includes:

• Balance sheet • Profit and Loss Statement • Cash flow statement • State of Equity’s Movement

Business Planning and Analysis
The business plan, in sense serves as compass for entrepreneur, because it allows a better understanding of the business, at the same time that forces him to investigate, reflect and visualize all the factors. Both internal and external’s factor will affect the progress of your business in the same way.
Business plans are documents subject to constant updates and rethinking, in accordance with the dynamics of business management with tools such as benchmarking and SWOT analysis.
The business plan is a document that synthesizes the way in which a business initiative must be organized and act to be successful. In this sense, the business plan defines the objectives that the company intends to achieve. Hence, a business plan must contemplate several elements:
Planning: It is the phase, which the business idea has explained, the company is describe, and the products or services that will be commercialize are exposed.
Marketing: Where, after analysis and market study, the marketing strategies will be implemented, the public to which the products or services are directed, as well as aspects directly related to their sale, such as pricing, distribution channels that will be used among others.
Operation: It is where the organizational structure of the company has defined, the administrative policies, as well as the techniques and procedures to produce the goods or services that will be commercialize.
Production: Phase where all the issues related to the production of the products are defined, which includes issues such as suppliers, minimum stocks, the logistics of distribution, among other aspects.
Administration: Point where issues such as credit policies, creditors management, account management, as well as financial plan, sales projection, cash flow, profitability, among other things are set.
Summary: it is the final part of the business plan, and it explains, in summary, the most important information of the project as a business, its strengths and the investment required.
Sampling, Forecasting and Business Modeling
We offer solutions and professional advice for:
• Monte Carlo simulations results
• Financial / economic forecasting
• NPV of an investment
• Real Options Pricing
• Financial modeling
• Credit approval / disapproval
• Budget Optimization
• Competitor entry
• New Product Entry


Delegated Management
When your business is starting up, its very important to maximize financial resources. LUKRUM HUB provides the opportunity to grow your business trough a delegated management from your own country.
Outsourcing your office, LUKRUM HUB will invoice your clients, manage your account payables and receivables, book your transactions, receive correspondence from authorities and prepare your books and records according with US Tax Rules.
Given the business owner the advantage to access our management system remotely and see the behavior of your business in real time 24/7.
Merge & Acquisition
Adding Value to your Company
Entrepreneurs are the engine of our society. They are the innovators, the visionaries, the idea generators, and the stallers of future change. They have a deep passion for creating goods and services. Walt Disney had a desire to take his daughters to a healthy place on the weekends. The healthy place did not exist and created Disneyland. Steve Jobs loved music. I wanted to create a device that consents to thousands of songs. Also, I wanted to be able to download music in a very easy and legal way. He developed the iPod and iTunes. And such is with entrepreneurs. They follow their passion and are the most interesting and misunderstood kind of people in the world.
Entrepreneurs take risks to follow their passion. Many risks all their possessions to follow that passion.

Creating company value is not synonymous with following passion and taking risks. The value of the company is the value of the business. Creating value companies is often a methodical process followed over a period of time. The value of a company is the measure of the value of this company to other people. Some key factors that influence the value of the company are the following:
• Strong customer relationships at all levels
• Patented products or services
• No customer accounts for more than 5% of revenue or profit
• Strong management team
• Excellent employee turnover and relationships
• Consistent revenue and profit trends
• Plant and equipment in good condition
• Intellectual property assets, which are legally protected
Branding: Creating a “Brand” creates incredible value for companies. Looking at today’s world, it’s easy to see why brands are more important now than any other asset in the last 100 years. Trademarks are the combination of psychology and science, both of which are combined as a trademark rather than a trademark. Products have life cycles. Brands outlive products and companies. Brands convey quality, credibility, and expertise in a uniform manner. Brands are valuable.
Successful business transition
There are about 160,000 private companies in the United States with sales of between $2 million and $350 million. Of those, an average of only 9,300 (6%) are successfully sold each year.
On the other hand, there are a significant number of investors, ready today to buy private companies.
With rare exceptions, companies do not automatically find investors to buy them. Selling a company requires a lot of work. It requires the owners to pre-determine the expectations of the sale, such as:
• Cash free/available after taxes and debt
• The employees of the company are or are not an important part of the sale
• Family members and their roles with the buyer
• Whether the transaction will be a net cash or a financial instrument with variable return
• Etc.
Now, a business in good condition receives more and better offers, than one less ready to be sold. A well-prepared company advances negotiations and sells faster. Most likely, your company can improve trust in and perception from a buyer’s perspective. The more confidence a buyer can develop in you and your business, the fewer opportunities that buyer will have to question aspects of the business and trade their price for a lower one.
There are many types of buyers from private companies. Each investor has different purchase objectives and consequential prices. Some of the potential buyers may include:
• Strategic
• Financial
• Management (MBO)
• Employee Stock Ownership Plan (ESOP)
• Family
• Private Equity Group (PEG)
• Initial Public Offering (IPO)
• Etc.
To begin with, your first step should be to form a professional team trained to advise you. Most entrepreneurs select their professional team on the eve of the sale. This is too late in the sales process. The selection of your professional equipment should be made several years before the tentative sale date, the goal is to get your guidance in the pre-sale years as to methods to minimize obstacles and secure the sale price.
The Different Buyers
Below is a list of the most common buyers in the United States of America.
Strategic
Buse companies that create synergy with their existing businesses. Because strategic buyers can actually get more value from an acquisition than the intrinsic value of the company being acquired, strategic buyers will generally be willing to pay a higher price for the deal to be given.
Strategic buyers have different motivations and goals than other buyers. They are often more inclined to pay more for a business than other buyers because of their goals and objectives such as: and expand, coverture geography; caption major market share; improve market entry; or obtain access to new customers; and prevent a competitor from gaining market advantages’.
Financer
It is the type of buyer who is primarily interested in the return on capital, investment, burden on management, and cash flow of a company. To determine this information, a financial buyer will carefully examine a company’s financial statements and assets.
A financial buyer is usually a long-term investor looking for a solid and well-managed company. Financial buyers rarely make immediate changes, except in change situations where companies are not currently profitable.
Many everyday retail investors could be considered financial buyers. An investor who takes a value or growth approach to investing for the long term is by following many of the same strategies as financial buyers.
Another example of a financial buyer is an executive looking to buy a job by finding a company to manage or improve it; on the other hand, this could simply be looking for companies that can offer a good return on investment and plan to maintain current management.
Purchase of Management (MBO)
The Management of a company can become the buyer of the company. Generally, it does not have the resources to buy a company in cash. The seller often creates a secured or convertible note into shares of the company.
An MBO occurs when an existing management team buys all or part of the company in which they are employed.
Employee Stock Ownership Plan (Esop)
An owner wants to transfer the company to employees, increase profit after tax, diversify personal assets, and even control key decisions can create an ESOP.
An ESOP is a qualified plan under ERISA (Department of Labor). An ESOP is a tax-qualified defined contribution plan that has two particular characteristics: (1) It allows you to invest exclusively in the shares of your sponsoring company, and (2) you can borrow money. A sponsoring corporation may contribute cash or stock to an ESOP on a tax-deductible basis. ESOP, at fair market value, often avoiding capital gains tax altogether in the transaction.
Family
A member of a family or group of these does not have the resources to pay in cash the total of the EBITDA multiple so they proceed to this purchase through a future performance or profit contract. This is a contractual provision that states that the seller of a company must obtain additional compensation in the future if the company achieves certain financial goals, which are usually set as a percentage of sales or gross profits. If an entrepreneur looking to sell a business is asking for a price more than a buyer is willing to pay, a profit disposition can be used. In a simplified example, there could be a purchase price of $1,000,000 plus 5% of gross sales over the next three years.
There are no rules, or standards that support the level of payment, it depends on a number of factors, including the size of the business. This can be used to bridge the gap between the different expectations of buyers and sellers. Profit helps eliminate uncertainty for the buyer as it is linked to future financial performance. The seller also receives the benefits of future growth over a period of time.
Private Equity Groups (Pegs)
Peg (Private Equity Groups) are financial buyers who generally make direct investments in small and medium-sized enterprises (SMEs) and tend to pay 4X to 7X the EBITDA of companies. They normally make controlling investments (50% or more), however, many groups will take a minority position in the most promising deals. Private equity groups provide strategic capital for a range of activities, including recapitalizations, leverage accumulations, acquisitions of holdings, and acquisitions of outgoing investors. PEGs are opportunistic investors and look at many deals before making an investment. Often, PEGs will create investment opportunities by sponsoring an executive team to target an industry in which the team has relevant experience and a strong track record. Many PEGs are comfortable investing in family businesses.
Cash Flow Projections
Business owners hate surprises, especially on the issue of cash. There are few things that tear the guts of an entrepreneur as much as discovering, with very little time to react, that your company has little money to make payments on important things like payroll, rent, debt service, suppliers, etc.
There’s one discipline that can help eliminate surprises from cash flow, called Cash Flow Projection.
Done correctly, a cash flow projection can give the owner the ability to look to the future to see the cash that will flow in and out of the company.
The first step is to find an internal person you can trust to prepare and maintain the Cash Flow Projection. This person must have integrity, good work ethic, and the ability to think about different scenarios while working weekly on the Cash Flow Projection document and process. Maintaining the confidentiality of cash flow matters is paramount to this person.
Step Two: Have this person set up a cash flow projection similar to the following or have a trained professional train this person to create and update this document.
Working Capital Improvements
Working capital is a measure of both a company’s efficiency and its short-term financial health. Working capital is calculated as: Working capital = Current assets (less) Current liabilities. The working capital ratio (Current Assets/Current Liabilities) indicates whether a company has enough short-term assets to cover its short-term debt. Any result below one indicates negative working capital.
Working capital is usually very easy to calculate and can usually be done in a few seconds. This calculation becomes difficult, if not impossible, if a company’s Balance Sheet and Income Statements are not correct and if these financial statements are not issued to the owners in a timely manner (within a few days after the end of the month). Erroneous and late financial information can cause significant pain to a business owner.
Working capital for internal purposes is critical. It tells a business owner if there are enough assets to cover short-term liabilities, such as payroll, rent, debt service, accounts payable to suppliers, income taxes owed by the owners and/or the business, other overheads, etc. Importantly, working capital will tell the owner if the company has enough assets for other things, such as owner distributions, capital expenditures, investments in marketing and sales, etc.
Any bank or lender will know the working capital ratio for your company’s industry (let’s talk about discovery GAP Analysis™). One of the first things a bank will do is measure a company’s working capital ratio to the industry average ratio.
Working capital that is below industry standards could cause banks to deny loans or raise interest rates, costs, etc.
Most loans or loans with banks have a section called “covenants”. It is typical for banks to include a minimum working capital ratio in the financial sector pacts section of their notes. A company’s failure to meet the minimum working capital ratio can cause a bank to cancel a loan and/or to deny future loans.
There are many things a company can do to improve working capital. These improvements can take time and a lot of work.
Below are some generic improvement suggestions that could help with these efforts:
1. Ensure that your company has timely and accurate financial statements, that is, there are no errors in the Balance Sheet and the Income Statement and that these financial instruments are delivered to you within a few days after the end of the month.
2. Collect accounts receivable within the terms of customer invoices.
3. Keep too little excess inventory and don’t have outdated inventory.
4. Negotiate discount terms with key suppliers.
5. Ask an expert to help you move some of the short-term debt to the long-term debt if this move is necessary and prudent.
6. Have your staff provide accurate monthly cash flow projections. These projections must be continuous for at least seven months.
7. Improve final profits by increasing sales, sales margins, and/or decreasing expenses.
8. Obtain and properly manage a working capital line of credit, if necessary.
9. If possible, ask for advance deposits from customers, especially those you think might be behind on paying their bills.
10. Hire competent talent who not only understand this topic but have decades of experience.