Tax moves for a savvy scaleup: Designed in America, Made in China, Taxed in Ireland… Zero Tariff?
In today’s hyper-connected tech industry, a startup can be conceived in Silicon Valley, engineered in Shenzhen, monetised through Dublin and shipped worldwide with an expectation of “tariff-free” trade. But as scaleups push across borders, they collide with a maze of tax rules that are often a step behind their global business models.
Ultimately, these tax considerations feed directly into investor readiness and your funding narrative. A savvy investor wants to know that your rocket ship growth won’t be yanked off-course by a tax problem. As you prepare for due diligence, make sure you (and your team) can confidently answer these five questions.
1. Team and structure
“How are you using tax-efficient schemes to attract talent and structure growth?”
Highlight your equity incentive plan (EMI or equivalent) that gives a tax-advantaged upside to your team and reassure them that your corporate structure is built for global growth (and won’t block a future exit).
Considerations: Incentives, Cross-Border Teams, Holding and Financing Structure
2. IP & R&D
“Where is your core IP held, and why there?”
Be ready to discuss how you are leveraging R&D incentives or low-tax jurisdictions for IP without storing profits in a tax haven unjustifiably.
Considerations: IP Havens vs Perception, Incentives, Substance and anti-avoidance
3. Transfer pricing
“How do you price transactions between your entities, and can you show they’re arm’s length?”
Investors want assurance you won’t face retroactive tax bills for shifting profits around.
Considerations: End of Treaty Shopping, Transparency and Reporting, BEPS
4. Supply chain taxes
“What duties, tariffs or VAT could impact your cost of goods sold?”
Show that you’ve done your homework on customs and trade taxes and have strategies if a new tariff strikes (as seen recently with US-UK trade tensions).
Considerations: Navigating Local Taxes, Trade Deals, Compliance costs
5. Global expansion
“At what point do you establish a new entity in a global market?”
Demonstrate that you know the tipping point between a scrappy market entry and triggering a taxable presence or local digital taxes. You have a plan for tax compliance as you scale internationally.
Considerations: Indirect Taxes, Digital Services Taxes, Permanent Establishments
Conclusion
“Designed in California, Made in China, Taxed everywhere you have economic substance and value creation… Tariffs to be navigated carefully” captures the modern tech company’s ambition: truly global and optimising every advantage. By understanding the tax implications behind each part of this tagline, you turn potential pitfalls into strategic advantages. In doing so, you not only avoid costly surprises but also tell a more compelling story to investors. You are showing them that you’re building a world-class business, with eyes wide open and ready to flex with the world’s ever changing rules.
These issues are nuanced, and every business is different. The right tax structure should not just be clever. It must be credible, robust, and ready for scrutiny. That’s where experience matters. Real structuring is never about shortcuts and behind every smart tax plan is serious legal thinking, practical execution, and alignment with the business model.
Ultimately, what you need is a clear tax philosophy – one that guides your decisions, withstands investor scrutiny, and positions your business strategically for the future. And that’s where we come in.
Download the full report here.
