If I work as an independent contractor (software development) for a startup, getting paid both in cash payment and equity (with lot of upside), should I apply as a business or do I need to apply as individual investor (for the capital gain on the equity) as well?
I’m in the exact same boat. You need Act 60 for both Export Services and Individual Investor.
Create your Act 60 LLC. Bill your startup for consulting services via the LLC. That’s at a 2/4% business tax. Your equity should also be awarded to your LLC so it is only taxable at 2/4%. Your board may balk at awarding equity to an LLC. Your mileage may vary.
The equity/cash will then be distributed at 0% from your LLC to your person. The capital gains of the equity will then be at 0%.
2% for the first 3 million usd, per year. 4% after the 3 mil.