Clients come to us with the same two questions again and again; ‘how can I start an online casino and manage my revenues efficiently?’ and ‘can you help me set up my own online casino platform?’
...If you have the same questions, you are at the right place!
In this article, we will first of all, explain how you can manage your revenues efficiently and then we will take you through the whole cycle of setting up your own online casino from scratch. So please be patient!
It discusses the fundamentals of setting up your online casino, and covers everything from the legal structure, payment system, tax situation and even creating the website and gaming software.
We begin with explaining what currently is the best structure. This structure consists of a Curacao company, holding the primary e-Gaming IP license. Along with an EU holding company for accepting payments. An EU company is needed for engaging in and meeting the requirements of the EU based 3rd party suppliers, for instance, Payment Processing Platforms "PSPs" and Banks.
Why choose a Curacao E-Gaming license?
Online gambling is a licensed activity. Curaçao offers the most widely used, quickest to obtain, and affordable license. Curaçao provides one eGaming license type that covers all games. There is no need to apply for various types of E-Gaming Licenses, like Malta, that offers four different types of licenses, which can be proved costly to setup and manage and above all takes a lot of patience to obtain.
The Curacao E-Gaming IP (Information Provider) license covers all games and services of skill, chance, sports betting and wagering related services.
Read more about the Curacao Gaming License here
Starting your online gambling site
To start with, in order for your business to be able to accept and process online payments through credit cards and other types of electronic payments, you need a merchant account. A merchant account is an agreement between a retailer, in our case the online casino, a merchant bank and a payment processor for the settlement of credit card and/or debit card transactions.
Due to ongoing regulatory scrutiny, it is now next to impossible for offshore companies in jurisdictions such as Curacao to accept online payments. Given the fact that you need to accept payments on your website before people can start playing, you need this crucial element: a payment-processing agent.
What is a payment-processing agent?
A processing agent is a company that is part of the structure, which processes payments for your website. For this, it receives a small fee (to satisfy local tax rules).
Depending on your desired target audience, we will provide you with the most suitable Payment Service Provider. There are two different types of Merchant accounts:
International Merchant accounts are opened and operated by payment processing providers in the US, and to some extend Singapore and Hong Kong. Such accounts are mostly used in these regions only because the merchant accounts are connected to an acquiring bank of the same region.
European Merchant accounts are set-up using an EU acquiring bank and operated at a bank that is either based or operating in the European Union region. It is therefore required that the company must also be incorporated in a country of the EU region. However, your clients can pay from any location, not just the EU, with no restrictions at all!
So, which Payment service provider I should use?
Since the majority of PSPs are European based, they require an EU registered company. But in order to acquire the Curacao eGaming IP license you need to set-up a company in Curacao. So that means registering two companies.
But don’t worry! We can set-up an efficient structure by registering an EU company, which will act as a payment-processing (collecting) agent
for your existing non-EU Company. Your Curacao Company will have an agreement with the EU Company, where the latter will be offering these services for a fee.
In which EU country should I register my company?
The best jurisdiction for registering a payment agent for an online casion is one that:
has a low tax rate of course
has experience with such arrangements and ensures compliance is maintained, so that you cannot lose your license or your access to banking
and offers access to a variety of credit-card payment providers
One good option, is Cyprus
Why do I need to set up a company specifically in Cyprus?
Cyprus is an EU country and it has one of the lowest corporate tax rates of the developed world. It allows access to payment systems and its regulatory body accepts these set-ups. In order to start a business here, you will need local substance, such as a director and accountant.
By registering your company in Cyprus, you can benefit from a long list of benefits such as, over 60 double tax treaties, no withholding tax on interest and dividends paid to non-residents of Cyprus and more, which is explained right here.
Profit distribution from Cyprus to Curacao
As mentioned previously, you will need to set-up a company in Curacao, which acquires the license. This company then becomes the shareholder of a Cyprus company. The Cyprus entity will open an account, which will process all proceeds from the processing operations.
Hence, all the income in this structure passes through Cyprus, but flows directly to Curacao. Of the total income, 3 to 4% is invoiced as management fee by the Cyprus Company, which is then taxed at 12.5%. This is an effective tax rate on total income of 0.375%. All profits in Curacao are taxed according to the arrangement mentioned above. From there, your profits can be freely distributed to you without taxes on dividends.
The Cyprus Company will sign an Agreement for Services with us, as well as an Agency Agreement with the Curacao Company, stating that it will be responsible for all the transactions and operations of the Curacao Company. This is the only way to prepare proper financial statements for the Curacao entity.
As you can see, to offer gaming services, requires some planning. But for the serious entrepreneur, this structure offers a solid low-tax legitimate way to offer gaming products that are massively in demand in the "new normal".
: According to The Business Research Company
“The global gambling market is expected to reach a value of around $565.4 billion, growing at an annual rate of 5.9% through 2022!”
How to develop the actual online casino?
Now that we have explained our proposed structure, you have probably noticed that there is a missing piece from the puzzle. In order to get an approved IP E-gaming License you need to have a ready-made gambling software and website ownership. So, if your next question is ‘How am I supposed to develop my gambling software?’
Well, we have great news! We partnered with a casino software development company, who will assist you with setting up your own online casino and achieve maximum results. Such companies allow you to set up your own casino website from scratch, including Turnkey and White Label Casino solutions, Back-end & Front-end, Mobile versions and 60+ casino game providers under a single integration.
Our experienced partners will give you the best insight into what they can offer you and what can work best for your casino business.
Why choose Internet incorporate to help build your own online casino?
In one word, we have all you need to start and run your successful online casino business.
We would be glad to help you reduce the stress involved in the strict procedures of obtaining all the above requirements in order to build your own online casino.
Partnering up with us, means having a chance to use premier iGaming products and services to build a strong casino brand on the market. The technical team is hardworking and professional at providing answers and solutions to all your challenges; they believe in cutting-edge technology, and design. But most importantly they offer round-the-clock customer support, without hidden costs nor extra charges for products and services that you get.
Will you "open the doors" of your online casino soon?
Then contact us now
by using the form below to discuss your Online Casino Project!